Sanders to Mattis: Crack Down on Pentagon Waste, Outrageous Contractor Pay

WASHINGTON, March 14 – Sen. Bernie Sanders (I-Vt.), ranking member of the Senate Budget Committee, sent a letter to Secretary of Defense James N. Mattis Wednesday asking him to address the excessive compensation of defense contractors, the widespread misconduct and fraud in the defense contracting industry and massive cost overruns in the acquisition budget.

Last year, the CEOs of Lockheed Martin and Raytheon – two of the top four U.S. defense contractors – were each paid more than $20 million in total compensation. More than 90 percent of those companies' revenue came from defense spending.

"What kind of message does it send when a defense contractor is paid 100 times more than the secretary of defense?" Sanders wrote in the letter. "Corporate interests should never take precedence over the interests of taxpayers or our national security. But paying exorbitant salaries to defense contractor CEOs makes that outcome more likely, and that is simply unacceptable."

Sanders asked for “a list of recommendations on reducing excessive defense contractor compensation, and what steps, if any, DoD is taking to address this issue.”

Sanders also asked Mattis to provide a strategy to prevent future fraud by defense contractors. About half of the Pentagon's $700 billion annual budget goes directly to private contractors, yet virtually every major defense contractor in the United States has paid millions of dollars in fines and settlements for misconduct and fraud in the past 20 years.

In 2011, Sanders requested a report from the Pentagon on defense contractor fraud, which showed that hundreds of defense contractors and their parent corporations that had defrauded the U.S. military—or settled allegations of fraud—received more than $1.1 trillion in Pentagon contracts over the previous decade. 

Finally, Sanders called on Mattis to hold defense contractors accountable for the significant cost overruns that American taxpayers have been forced to pay, and to work to prevent future overruns. Out of a $1.46 trillion Department of Defense acquisition portfolio, approximately $484 billion is due to cost growth above the original cost estimates, according to the Government Accountability Office.

At a Senate Budget Committee hearing last week, Sanders questioned Pentagon officials over the outrageous salaries of CEOs at major defense contractors and demanded that the Pentagon end its waste and abuse of taxpayer funds.

"I would hope that nobody here believes that just because this is the Department of Defense, we will defend an enormous amount of bureaucratic waste," Sanders said at the hearing.

To read Sanders' letter, click here.