Samuel Lowenberg - Independent Journalist biography articles articles

Stocking up for the next war

Legal Times  April 5, 1999


Even as NATO's pilots are testing their firepower in the campaign against Yugoslavia, the alliance's commanders are preparing their war inventories for future battles. Military and political leaders from 44 countries, drawn to Washington, D.C., for the 50th Anniversary Summit of the North Atlantic Treaty Organization, are being welcomed--and lobbied--by representatives of dozens of the world's largest companies. Together, the corporate salesmen are capable of outfitting an army with everything from K-rations and telephones to staff cars, fighter jets, and ballistic missiles.

The merchants' conduit is the NATO Host Committee, a group of multinational corporations that is hosting a stream of parties and events, and providing communications equipment and transportation, for the hundreds of dignitaries who arrived late last month and will continue to descend on Washington over the next few weeks.

Contributing to the committee offers company lobbyists and executives a chance to schmooze with foreign dignitaries and military brass who represent a potential bounty of big-ticket customers for not only military equipment but also consumer goods.

"It is good corporate citizenship, which has a payoff, " says Robert Liberatore, senior vice president for external affairs and public policy at the DaimlerChrysler Corp. and vice chairman of the Host Committee's board of directors.

"It has a payoff in how a company is regarded."

The Host Committee is only the latest in a series of efforts since the mid- 1990s by multinational corporations that see NATO enlargement as a marketing opportunity. Committee members who previously lobbied Congress to expand the alliance's membership include armament, communications, energy, and tobacco companies, says former Rep. Gerald Solomon (R-N.Y.), who was chairman of the House Rules Committee and chairman of the House Republicans NATO task force. Solomon left office in January and is now with the Solomon Group, a lobbying firm.

The Host Committee was established at the behest of the Clinton administration to cover the costs of the summit, since Congress does not allocate money for such functions.

The access and exposure to foreign officials it provides for companies does not come cheap. The 11 corporations on the committee's board had to pony up at least $250,000 each in either cash or in-kind contributions for a seat. A number of other companies paid a smaller fee for lower-profile billing.

Besides Daimler Chrysler's Liberatore, the board is composed of executives from the Ameritech Corp., Ford Motor Co., General Motors Corp., Honeywell Inc. , Lucent Technologies Inc., Motorola Inc., United Technologies Corp., TRW Inc. , Nextel Communications Inc., and SBC Communications Inc.

All of these companies and more were present at the Host Committee's reception at the Polish Embassy on March 25. The gala brought together European and American diplomats and generals, Clinton administration national security aides, congressional staffers, and a gaggle of Washington corporate lobbyists.

The event took on a surreal aspect because of unexpected world events, as members of the military-industrial complex hobnobbed and back-slapped at a lavish banquet only a day after NATO bombs had begun falling on Yugoslavia. Party-goers included former NATO Supreme Commander George Joulwan, now with the K Street lobbying firm Global USA; Christopher Hansen, senior vice president of the Boeing Co.; Michael Kirst, director of government and international affairs for the Westinghouse Electric Corp.; Harry Pearce, vice president of business development for the Northrup Grumman Corp.; and Charles Manatt of Manatt, Phelps & Phillips; as well as emissaries from the Raytheon Co., Arthur Andersen, Visa U.S.A. Inc., and others.

One company rep with a specific interest was John Wakefield of the Sikorsky Aircraft Corp., which is trying to cement a deal to sell Poland a few dozen of its Black Hawk helicopters, which reportedly start at about $10 million apiece. Sikorsky's parent company, United Technologies, is a member of the Host Committee's board.

Another board member, Motorola, joined the committee in part to promote its new radio phone, which has just been introduced in Europe.

"Being a member of the Host Committee, you have an opportunity for contacts and relations so you can speak with ministerial-level people and their staffs, " says Arnold Brenner, Motorola's head of global government relations.

A particular objective in lobbying these European officials, Brenner says, might be "trying to influence the rule-making that would be necessary" to make their countries' communications networks compatible with Motorola's.

Another attendee, Lloyd Hand, name partner at Verner, Liipfert, Bernhard, McPherson and Hand, has long worked on behalf of major defense contractors such as Raytheon, Newport News Shipbuilding, TRW, and the Lockheed Martin Corp. Two former senate majority leaders who work at his firm, Bob Dole (R- Kan.) and George Mitchell (D-Maine), are co-chairmen of the Host Committee's honorary committee.

Verner, Liipfert was hired in 1997 by the American Friends of the Czech Republic, the American Friends of Poland, and Peter Rona, a Hungarian- American, to lobby for those countries' membership in NATO, which admitted all three on March 12. Although Dole was not registered to lobby on the issue, he did call ex-Rep. Solomon to discuss it last year, according to the former congressman.

Solomon says the two were talking about the issue as friends and former colleagues. Dole was not available to comment but an aide insisted that Dole does not lobby, but rather speaks with "friends up on the Hill and he has no control of where the conversations will go." For the White House, lining up corporate sponsors for the Host Committee was a delicate matter. The administration wanted to be sure the committee did not come across as a tool of the defense industry, says a senior Clinton administration official. "We wanted a balanced board, not simply one sector of industry, so that there was not a perception that the sponsorship was driven by anything other than the broad motives of the host committee, " which were simply to sponsor the NATO summit, says the official.

The administration's sensitivity comes after articles in The New York Times and The Nation detailed aggressive lobbying campaigns by the defense industry over the last few years pushing for Poland, Hungary, and the Czech Republic's admission into NATO. The arms makers, according to the articles, hoped to sell the new member countries billions of dollars worth of high-tech weaponry.

Both publications detailed how Lockheed-Martin's director of global development, Bruce Jackson, founded the non-profit U.S. Committee to Expand NATO, which lobbied Congress heavily on the issue.

Jackson said in an interview last week that he was acting on his own behalf, not as a Lockheed employee. He is now advising the NATO Host Committee, whose president, former Tenneco Inc. lobbyist Sally Painter, was also a member of his pro-expansion group.

Joel Johnson of the Aerospace Industries Association, a military aircraft trade group, downplays his industry's efforts to expand NATO, saying it was more talk than action. And, he adds, the impetus behind the defense companies' lobbying was provided by the countries themselves. "That's what the customers wanted, " he says. Companies like Lockheed or Boeing, he adds, wanted "to be able to go back to the ambassador and say, Hey, look what we did for you.'"

But the companies' efforts appear to have been been premature: In the mid- 1990s defense manufacturers were expecting to start selling the new democracies their high-tech weaponry, but economic realities soon set in. Optimistic calls from these formerly communist countries for hundreds of American supersonic jet fighters soon dwindled to a request to lease a few aircraft several years into the new millennium.

"The market doesn't seem to be nearly as big as they had hoped, but they are still pitching pretty hard, " say William Hartung, a Senior Fellow at the World Policy Institute for the New School for Social Research and the author of several studies tracking the efforts of defense contractors to promote NATO expansion.

Efforts like the Host Committee, he says, show that the companies are "still jockeying for position" with their European competitors. "They really want to keep schmoozing up these folks."

All Material Copyright Samuel Lowenberg