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Bombs Versus Budgets: Inside the Nuclear Weapons Lobby

June 6, 2012 | Report

By William D. Hartung, Christine Anderson

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Executive Summary

The battle over deficits and defense has focused attention on the costs of nuclear weapons.  Estimates of the full costs of nuclear weapons-related activities are hotly debated, but there is no question that they will reach hundreds of billions of dollars over the next decade.

At a time of tight budgets, there is a real possibility that some of the systems and facilities described so far could be reduced, delayed, or cancelled outright.  For example, former Vice-Chairman of the Joint Chiefs of Staff General James Cartwright noted in July 2011, “The challenge here is that we have to re-capitalize all three legs [of the nuclear triad], and we don’t have the money to do it.”  That same month, General Robert Kehler, the head of U.S. Strategic Command, asserted, “We’re not going to be able to go forward with weapon systems that cost what weapon systems cost today.”  

This report provides a profile of the nuclear weapons lobby, noting along the way that in a constrained budgetary environment different parts of the lobby may either collaborate to promote higher nuclear weapons spending or compete for their share of a shrinking pie.

Key Findings of the report include:

  • The Pentagon and the Department of Energy’s National Nuclear Security Administration are scheduled to spend hundreds of billions of dollars on nuclear weapons projects over the next decade and beyond, including $68 billion to develop and purchase a new generation of nuclear bombers; $347 billion to purchase and operate 12 new ballistic missile submarines; and billions more on new nuclear weapons facilities. 
     
  • In the 2012 election cycle, the top 14 nuclear weapons contractors gave a total of $2.9 million to key members of Congress with decision making power over nuclear weapons spending.  These firms have donated $18.7 million to these same members of Congress over the course of their careers. 
     
  • More than half of the contributions cited above went to members of the four key subcommittees with jurisdiction over nuclear weapons spending  – the Strategic Forces Subcommittees of the Armed Services Committees in each house and the Energy and Water Subcommittees of the Appropriations Committees in each house.  Total contributions by major nuclear weapons contractors to members of these four subcommittees have been over $1.6 million in the 2012 election cycle thus far, and $11.7 lifetime to these same members.
     
  • Of the 14 nuclear weapons contractors tracked in this report, Lockheed Martin has been the biggest contributor to key members of Congress with influence over nuclear weapons spending. So far during the 2012 election cycle, Lockheed Martin has donated $535,000 to these key members; other major donors include Honeywell International, $464,582; Northrop Grumman, $464,000; and Boeing, $336,750.
     
  • Leading advocates of high levels of nuclear weapons spending have received hundreds of thousands of dollars in campaign contributions from major nuclear weapons contractors in the course of their careers.  These advocates include House Armed Services Committee Chair Rep. Howard P. “Buck” McKeon (R-CA), with career receipts of $809,150 from these companies; Rep. Michael Turner (R-OH), Chair of the Strategic Forces Subcommittee of the House Armed Services Committee, with $144,400 in career receipts ; and Sen. Jon Kyl (R-AZ), with $250,875 in career receipts.  Rep. Denny Rehberg (R-MT), who sponsored an amendment designed to block funding for the implementation of the New START arms reduction treaty with Russia and protect ICBMs based in his home state, has received $118,990 from nuclear weapons contractors in his career in Congress.
     
  • The top three recipients of contributions from major nuclear weapons contractors in the House for the 2012 election cycle are House Armed Services Committee Chair Howard P. “Buck” McKeon, $257,570; Rep. Norm Dicks (D-WA), the Ranking Democrat on the House Defense Appropriations Subcommittee, and a major booster of the building of a new bomber, $110,000; and Rep. Mac Thornberry (R-TX), a member of the Strategic Forces Subcommittee of the House Armed Services Committee, $87,250.
     
  • The top three recipients of contributions from major nuclear weapons contractors in the Senate for the 2012 election cycle are Sen. Dianne Feinstein (D-CA), Chair of the Subcommittee on Energy and Water of the Senate Appropriations Committee (the committee that oversees the nuclear warhead complex), $74,500; Sen. Kirsten Gillibrand (D-NY), a member of the Subcommittee on Strategic Forces of the Senate Armed Services Committee, $54,916; and Sen. Jon Tester (D-MT) a member of the  Subcommittee on Energy and Water of the Senate Appropriations Committee and member of the Senate ICBM coalition, $53,500.
     
  • The top 14 nuclear weapons contractors employ 137 lobbyists who formerly worked for key nuclear weapons decision makers.  The majority of the revolving door lobbyists – 96 – worked for key members of Congress or key Congressional Committees; 26 revolving door lobbyists worked for one of the military services; and 24 revolving door lobbyists worked for the Department of Defense or the Department of Energy.  Some lobbyists worked for one or more Congressional offices or agencies before leaving government, and many now work for more than one major nuclear weapons contractor.
     
  • There are 19 revolving door lobbyists working for major nuclear weapons contractors who were staffers for members of the Energy and Water Subcommittee of the Senate Appropriations Committee – the committee that controls spending on the nuclear warhead complex.

Recommendations:

1)  The ballistic missile submarine force should be reduced from 12 boats to eight, with additional warheads carried in each boat.  This would save $18 billion over the next decade while sustaining the capability to deploy the number of warheads called for under the New START treaty.

2)  Plans for a new nuclear bomber should be shelved, at a savings of $18 billion over the next decade.  At a minimum, the bomber should not be made nuclear-capable. 

3)  There is no circumstance under which it will be necessary to build large numbers of new plutonium “pits” or triggers for nuclear warheads.  Therefore, the Chemistry and Metallurgy Research Replacement facility at Los Alamos National Laboratories should be cancelled, at a savings of $5 billion over the next decade.

4)  Plutonium waste from nuclear warheads can be neutralized without building the multi-billion dollar Mixed Oxide (MOX) facility.  It too should be cancelled, at a savings of at least $4.9 billion in construction costs over the next twenty years.

Forgoing or slowing these projects would save over $60 billion over the next two decades, and hundreds of billions more over the prospective lifetimes of the programs.

Introduction: The High Cost of Nuclear Weapons

            The battle over deficits and defense has focused attention on the costs of nuclear weapons.  Estimates of the full costs of nuclear weapons-related activities are hotly debated, but there is no question that they will reach hundreds of billions of dollars over the next decade.  Stephen I. Schwartz of the Monterrey Institute for International Studies has called for the federal government to regularly publish estimates of the full costs of nuclear weapons, including research and development (R&D), procurement, operations, and support functions like command, control and communications.  As Schwartz has noted, "There's no easy way to determine what spending will be going forward, especially because there has never been an official, comprehensive nuclear weapons budget."[1]

What we do know is that there are official estimates of the costs of key elements of the nuclear enterprise.  If past experience is any guide, these estimates are likely to grow over time, but at the moment they include:

  • Up to 100 new nuclear bombers at cost of at least $55 billion;[2]
     
  • Twelve new nuclear submarines at a cost of $96 billion for procurement  and research and development and $347 billion in full life-cycle costs (including operations and maintenance) over the next five decades;[3]
     
  • New nuclear warhead-related facilities, including locations for the production of uranium, plutonium, and non-nuclear components, at an estimated cost of well over $13 billion;[4]
     
  • A facility for the production of Mixed Oxide (MOX) a potential fuel for nuclear power plants based on excess plutonium generated by the nuclear warhead program, at a construction cost of at least $4.9 billion.[5]

This is not an exhaustive list.  Other items slated for development by the Pentagon and the Department of Energy’s National Nuclear Security Administration (the agency charged with overseeing the nuclear weapons complex) include Life Extension Programs (LEPs) for existing nuclear warheads; possible upgrades or replacements for existing land-based Intercontinental Ballistic Missiles (ICBMs); the possible development of a new generation of nuclear-armed Air-Launched Cruise Missiles (ALCMS); and the adaptation of some Joint Strike Fighters to carry nuclear weapons.  Another major cost of nuclear weapons development and maintenance is environmental cleanup, which is estimated to cost hundreds of billions of dollars based on past and ongoing activities within the nuclear warhead complex.[6]

At a time of tight budgets, there is a real possibility that some of the systems and facilities described so far could be reduced, delayed, or cancelled outright.  For example, former Vice-Chairman of the Joint Chiefs of Staff General James Cartwright noted in July 2011 “the challenge here is that we have to re-capitalize all three legs [of the nuclear triad], and we don’t have the money to do it.”  That same month, General Robert Kehler, the head of U.S. Strategic Command, asserted “we’re not going to be able to go forward with weapon systems that cost what weapon systems cost today.”[7]

Any effort to downsize the nation’s nuclear force is likely to be met with fierce opposition from the individuals and institutions that benefit from the nuclear status quo, including corporations involved in designing and building nuclear delivery vehicles; companies that operate nuclear warhead-related facilities; and members of Congress with nuclear weapons-related facilities or deployments in their states or districts.  The Obama administration’s FY2013 budget proposal has already sparked a number of major fights over nuclear weapons spending.  Major points of contention include whether to fund a new facility designed to increase capacity for the production of plutonium components for nuclear warheads and whether to delay production of the first next-generation ballistic missile submarine.  In addition, House Republicans, led by Rep. Michael B. Turner (R-OH), chairman of the House Armed Services Committee Strategic Forces Subcommittee, have introduced legislation aimed at blocking implementation of the New START treaty if the administration does not adhere to nuclear weapons spending pledges made in the context of the 2010 treaty debate.  Supporters of the administration have noted that those spending pledges were made prior to the passage of the Budget Control Act in the summer of 2011, and that the point is not to spend a guaranteed amount but rather to spend enough to ensure that the U.S. nuclear arsenal remains safe, effective and reliable. [8]  In a related matter, in mid-May Rep. Denny Rehberg (R-MT), whose state has 150 Intercontinental Ballistic Missiles (ICBMs) based there, at Maelstrom Air Force Base  – introduced an amendment designed to prevent the Obama administration from spending funds to implement the New START arms reductions or to “eliminate a leg of the nuclear triad.”  Rep. Rehberg’s press release celebrating House passage of the amendment suggests that pork barrel politics may have played a larger role in his thinking than nuclear strategy: “Rehberg Amendment to Protect Malmstrom and Stop New START Passes House.”[9]

The ultimate decisions on how much to spend on nuclear weapons should be made based on what is needed to defend the country, not on the impact of that spending on certain companies or Congressional districts.  And, as is appropriate, much of the debate on whether to cut the nuclear arsenal will center on strategic arguments.  But making sensible cuts in the U.S. nuclear arsenal will also require policy makers to take on the money, power and influence of the nuclear weapons lobby.            

This report provides a profile of the nuclear weapons lobby, noting along the way that in a constrained budgetary environment different parts of the lobby may either collaborate to promote higher nuclear weapons spending or compete for their share of a shrinking pie.

Who Benefits from Nuclear Weapons Spending: The Corporate Connection

A handful of companies are the primary beneficiaries of nuclear weapons spending, backed up by an extensive network of subcontractors.  The key players are identified below, organized according to the system or facility with which they are most involved.

The Bomber Complex -- This sector is dominated by Boeing, Northrop Grumman, and Lockheed Martin, each of which would be a candidate to serve as prime contractor for a new bomber.[10]

Boeing is a major airframe producer, building or upgrading everything from bombers to fighter planes to tanker aircraft to commercial airliners. It designed and built the B-52, and in the 1990s it bought Rockwell International, the company that was the prime contractor for the B-1 bomber during the aircraft’s peak production years in the 1980s.

Northrop Grumman is the producer of the B-2 stealth bomber, a mainstay of the bombing campaigns in Iraq and Afghanistan that was produced in relatively small numbers (21 planes in all) during the 1990s and is the youngest aircraft in the current bomber fleet. 

Lockheed Martin has been a subcontractor on major bomber programs, but its main work in the aircraft sector has been as the producer of major fighter planes like the F-16, F-22 (with Boeing as a major subcontractor), and the latest generation fighter, the F-35 Joint Strike Fighter (with Northrop Grumman as a major subcontractor).

Other possible beneficiaries of a new bomber program are the country’s two makers of aircraft engines, General Electric and Pratt & Whitney (a division of United Technologies).  General Electric produced the engines for the two most recent bombers, the B-1 and the B-2, while the older B-52 runs on Pratt & Whitney engines.  Because of the limited number of aircraft being built by the U.S. military in recent years, the firms tend to compete, not cooperate. 

The most recent example of this was GE’s long battle to force the Pentagon to procure a second engine for the Joint Strike Fighter, the main U.S. combat aircraft of the next generation.  The fight in Congress pitted the Connecticut delegation (Pratt & Whitney) versus the Massachusetts and Ohio delegations (General Electric). After years of political wrangling the Obama administration and the Congress finally killed the GE second engine project in 2011, but not before each firm had spent millions in campaign contributions and advertising on behalf of its system.[11]

Submarine Production -- Current plans call for the procurement of 12 new ballistic missile submarines between now and 2033.[12]   Design work on the subs will be done at General Dynamics’ Electric Boat facility in Groton, Connecticut, with Huntington Ingalls Industries’ Newport News, Virginia shipbuilding facility serving as a major subcontractor.   It is likely that the prime contract for construction of the submarines will be awarded to Electric Boat as well.  The two companies’ relationship on the ballistic missile submarine program is described in Huntington Ingalls most recent annual report, which notes that the company will “perform, through an agreement with Electric Boat, as design subcontractor for the SSBN(X) Ohio-class replacement boats.”  The report further notes that “Although the contract is not yet negotiated, we expect to participate in the design effort, and we believe our experience and qualified workforce position us for a potential role in the construction effort.”[13]    

Another major beneficiary of a new SSBN would be the company that will develop the nuclear reactor that powers the ship.  The U.S. government’s naval nuclear reactor program is carried out by two laboratories that are run for the U.S. Department of Energy (DOE) by Bechtel Marine Propulsion.  The first lab is Knolls Atomic Laboratory, which has major facilities in Niskayuna and West Milton, New York.   The Knolls web site indicates that it designs “the world's most technologically advanced nuclear reactor plants for U.S. Navy submarines.”[14]  Bechtel also runs the DOE’s Bettis Atomic Laboratory in Pittsburgh, Pennsylvania, which is involved in research, design, testing and maintenance of naval nuclear reactors and has additional facilities in Charleston, South Carolina and Idaho Falls, Idaho.[15]

The submarine industry’s trade association, The Submarine Industrial Base Council (SIBC), claims that there are 5,000 U.S. companies that provide “critical materials” for the Virginia-class submarine.[16]  It should be noted that the council is a strong advocate of building more submarines, so its figures on the number of companies involved should be viewed skeptically.  No similar estimates, however exaggerated they may be, are currently available for ballistic missile submarines, but presumably a new SSBN program would draw on a similar supplier base.  The SIBC will be described in more detail below.

The Nuclear-Capable F-35 Joint Strike Fighter -- The United States currently has about 200 tactical (short-range) nuclear weapons in Europe.  Plans call for adapting a number of F-35 Joint Strike Fighters to make them capable of carrying these weapons, at a cost currently estimated at about $340 million.[17]  Lockheed Martin is the prime contractor on the F-35.

Other Delivery Vehicles -- There are other nuclear delivery vehicles that are not currently scheduled for replacement, including the nuclear version of the Air-Launched Cruise Missile (ALCM); the Minuteman Intercontinental Ballistic Missile (ICBM); and the Trident Submarine Launched Ballistic Missile.  Whether or not new systems are produced, there will be a lobbying battle over keeping them in the force.  For example, there is an ICBM coalition built around senators from Montana, Wyoming and North Dakota, where the nation’s 450 Minuteman III ICBMs are based.[18]  The two Senators from Utah are also members, based in part on significant ICBM maintenance and production work in their state (see more below). These deployments could be in danger if there were a move to reduce the current nuclear force of bombers, nuclear submarines and ICBMs from a “triad” to a “dyad,” a possibility that may come into play due to cost issues.

The Nuclear Weapons Complex -- This sector, which deals with nuclear warheads, is administered by the Department of Energy’s National Nuclear Security Administration (NNSA).  Each major facility is managed by one or more institutions, ranging from the University of California system to Babcock and Wilcox to Lockheed Martin.  The companies involved in running major facilities within the complex are listed below, organized by facility.

Chemistry and Metallurgy Research Replacement Nuclear Facility (CMRR-NF): The primary purpose of this facility, based in New Mexico at Los Alamos National Laboratories (LANL) is to help increase capacity to produce plutonium “pits,” the triggers that start the nuclear reaction in a thermonuclear (hydrogen) bomb.  The current estimate for the construction of the facility is over $5.8 billion, more than 10 times the original estimate.[19]

Critics of the project have questioned whether the CMRR is needed at all, given that there are more than enough pits available to support the current nuclear stockpile for decades to come, including capacity to build 20 more per year if needed.  A study by the well-respected scientific advisory group, the JASON group, estimated that the plutonium “pits” in current warheads will remain potent for 85 to 100 years.[20]  The operator of LANL, Los Alamos National Security Company LLC, is a consortium led by the University of California and including the Bechtel Corporation, Babcock and Wilcox, and URS Corporation. 

There is reason to think that the CMRR project could be reduced, restructured or even canceled in the light of upcoming pressures on the budget of the Department of Energy’s National Nuclear Security Administration (NNSA), the body that oversees the nuclear weapons complex.  As noted in a recent report on the CMRR project by the Washington-based Project on Government Oversight (POGO), the subcommittee of the House Appropriations Committee that deals with the nuclear weapons complex has indicated that “[m]any gaps remain in the planning efforts [for the Uranium Processing Facility and CMRR Project], and basic capability requirements and acquisition strategies continue to be re-evaluated.” Congress scaled back the administration’s funding request for CMRR from $300 million to $200 million in the FY2012 budget.  There was no funding requested for CMRR in the Obama administration’s FY2013 budget.[21]  The zeroing out of the project’s budget was justified on the grounds that it would be too expensive to build the CMRR and a new Uranium Processing Facility (UPF) simultaneously.

The Uranium Processing Facility (UPF):

The UPF is being built at the Y-12 National Security Complex in Oak Ridge, Tennessee.[22]  The principal purpose of the facility will be to manufacture “secondaries,” the uranium-based components of a nuclear warhead.   Estimates for construction of the plant have jumped from $600 million to $1.5 billion in 2005 to between $6 and $6.5 billion currently.[23]   The project was originally scheduled to come online in 2018, but the schedule has now slipped to 2022.  If carried forward, the UPF will be the most expensive bomb plant in history.  In an April 2011 report, the Alliance for Nuclear Accountability questioned whether the facility was needed at all:

With no new nuclear warheads on the drawing board and the demands for life extension programs diminishing, the UPF is fast becoming a project without a need. The cost savings, security footprint reductions, and manufacturing efficiencies advertised as benefits of the UPF can all be realized in existing facilities if they are consolidated, downsized and upgraded—at a fraction of the cost of a new facility.[24]

In keeping with the National Nuclear Security Administration’s (NNSA) plan to stagger production of the CMRR and the UPF, funding for the Uranium Processing Facility actually increased in NNSA’s FY2013 budget request, from $160 million to $340 million.[25]

As noted above, the UPF is part of the Y-12 National Security Complex at Oak Ridge, a group of facilities operated by a partnership of Babcock and Wilcox and the Bechtel Corporation.

The Mixed Oxide (MOX) Facility:

The MOX facility is being built at the Savannah River Site in Aiken, South Carolina.  Its purpose is to take plutonium waste generated by the nuclear bomb program and transform it into fuel that can be used to power civilian nuclear reactors.  The current estimate for construction of the plant is $4.9 billion, up from an estimate of $1.6 billion in 2004.[26]  Requests for construction funding for the project totaled $505 million in FY2011, $385 million in FY2012, and $569 million in FY2013.[27]

The MOX facility was originally envisioned as an economical way to dispose of excess plutonium generated by the U.S. and Russian bomb programs, thereby serving the dual purpose of generating civilian nuclear fuel while also reducing the risks that weapons grade plutonium might fall into the hands of terrorist groups or others seeking to build a nuclear weapon.  The first part of the equation has been called into question by the fact that there has been little or no interest among U.S. utility companies in using MOX fuel, a situation that will only be made worse by the fact that the Fukushima reactor that melted down in Japan was in part powered by MOX fuel.[28]  There is a real possibility that the MOX plant will have no customers when it comes online in 2016.  Meanwhile, an alternative exists for dealing with the proliferation risks entailed in storing weapons grade plutonium.  It can be immobilized and stored in the form of ceramic “pucks” in canisters of liquefied waste.  The technology for doing so already exists.[29]

The MOX project is being run by Shaw Areva MOX Services LLC, a partnership of the Shaw Group and AREVA, a French corporation with extensive operations in the United States and Canada.

The Kansas City Plant (KCP):

The Kansas City Plant (KCP) produces nonnuclear components for nuclear weapons.  About 85% of the content of a nuclear weapon is built at this facility.[30]   A new plant is in the process of being built in Kansas City, Missouri, at an estimated cost of $500 million.[31]  It is currently scheduled to become fully operational in 2014.  In an unorthodox procedure never before used in the development of a nuclear weapons facility, construction is being financed through the issuance of municipal bonds by Kansas City.

The new KCP is being built and operated by the private developer CenterPoint Zimmer (CPZ), a limited liability corporation composed of Zimmer Real Estate Services and Chicago-based CenterPoint Property Trust.  Construction is being financed with bonds issued by the Kansas City Planned Industrial Expansion Authority (PIEA).  CPZ is slated to receive $1.2 billion in lease payments over the next 20 years.  The facility will be sub-leased to the General Services Administration, but the income to make these payments will ultimately be provided by the National Nuclear Security Administration (NNSA), the federal agency that oversees the nuclear weapons complex.  This roundabout financing mechanism will mean that the funding for the plant will be “off the books” as far NNSA’s annual budget request is concerned, therefore making it harder for Congress to oversee and scrutinize the project.[32]

The Honeywell Corporation has the contract to operate the facility.

Life Extension Programs (LEPs): The NNSA spends billions of dollars per year to refurbish and upgrade existing nuclear warheads under Life Extension Programs (LEPs).  Two major projects now underway include work on the W78 and B-61-12 warheads. 

The W78 is slotted to replace current warheads on Minuteman III ICBMs, of which there will be 420 under the terms of the New START nuclear arms reduction program.  The full cost of the program is estimated at roughly $5 billion through 2025. Critics of the W78 program assert that it is unnecessary because 200 of the warheads deployed on Minuteman III ICBMs have recently been replaced by the W87, the product of another LEP.  In addition, they point out, there are about 550 W87’s in the stockpile that could be used to replace the warheads on the remaining Minuteman ICBMs in the U.S. arsenal.[33]

The B-61-12 is primarily aimed at producing modernized versions of 200 tactical (short-range) U.S. nuclear weapons now deployed in Europe.  As with the W78, a report by the Alliance for Nuclear Accountability questions the need for the B-61-12:

NATO is in the process of reevaluating its policy regarding nuclear weapons deployment.  The outcome of this debate is uncertain.  Moreover, the B-61-12 is being re-designed to fit on the new F-35 ‘Joint Strike Fighter’ and will no longer fit on the planes NATO counties presently use to carry current B-61s.[34]

The estimated cost of the program is $6 billion.[35]  The main work on the B-61-12 program is being done at Sandia National Laboratories in Albuquerque, New Mexico.  Lockheed Martin has the operating contract for Sandia.

Other Nuclear Weapons Facilities: There are a number of other major facilities that form part of the nuclear weapons complex.  They include the Lawrence Livermore nuclear weapons laboratory, run by Lawrence Livermore National Security LLC, which is composed of Bechtel National, the University of California, Babcock and Wilcox, the Washington Division of URS Corporation, and Battelle (the partnership also has an affiliation with the Texas A&M University); the Nevada National Security Site (formerly known as the Nevada Test Site), which is operated by National Security Technologies LLC (NTSec) a joint venture between Northrop Grumman Corporation, AECOM, CH2M Hill, and Babcock & Wilcox; and the Pantex Plant, a facility primarily involved in the assembly and disassembly of nuclear weapons, run by Babcock & Wilcox Technical Services Pantex, LLC (B&W Pantex), an independent company formed solely to manage the Pantex plant that involves Babcock and Wilcox Technical Services Group, Inc., BWX Technologies, Honeywell and Bechtel National.[36]

Companies with Multiple Roles in the Nuclear Weapons Industry: As illustrated above, a number of companies are involved in more than one major nuclear weapons-related project.  For example, Babcock and Wilcox plays a role in operating five facilities, including Lawrence Livermore and Los Alamos laboratories, the Y-12 National Security Complex, the Nevada National Security site, and the Pantex Plant.  Bechtel is involved in running four facilities -- Los Alamos, Lawrence Livermore, the Nevada National Security Site, and the Pantex Plant.  Honeywell plays a role at both the Kansas City Plant and the Pantex facility.  Northrop Grumman will be bidding on the next-generation nuclear bomber, and is also involved in the consortium that runs the Nevada National Security site.  And Lockheed Martin, which will also bid on the bomber project, runs Sandia National Laboratories.

Nuclear Weapons Contracts and Defense Dependency

It is difficult to gather precise data on the value of contracts related to the nuclear weapons projects described thus far.  The bomber and submarine projects are still in early development, and disaggregated data on contracts for work at specific sites within the National Nuclear Security Administration’s nuclear weapons complex is hard to come by.  Even so, there is value in looking at the level of Department of Energy and Department of Defense contracts received by the companies involved in developing nuclear delivery vehicles and running nuclear weapons facilities, to give some sense of how important new nuclear weapons projects may be to these companies.

Bomber contractors: Lockheed Martin, Boeing, and Northrop Grumman are among the nation’s largest military contractors, receiving tens of billions of dollars annually in Pentagon contract awards (see Table 1).

 

Table 1: Pentagon Contracts and Federal Contract Dependency of Potential Contractors for the Next-Generation Bomber Project, FY 2011

 

Company

DoD Prime

Contracts, FY2011

Govt Contracts as

% of Revenue

Lockheed Martin

$35.6 billion

82%

Boeing

$20.2 billion

38%

Northrop Grumman

$13.8 billion

90%

 

Source: Federal Procurement Data System, Top 100 Contractors Report, FY2011 and company 10K reports for their 2011 fiscal years.  Data on government contracts as a percentage of revenue (displayed in column 2) include both prime and subcontracts.

As seen in the table, each firm depends substantially on government contracts for its business, in the case of Northrop Grumman almost exclusively so. Boeing is less dependent due to its role in the production of commercial airliners.   Lockheed Martin’s military-related contracts top $38 billion once its $2.4 billion fee for running Sandia National Laboratories is taken into account.[37]

What this means, particularly at a time when Pentagon procurement spending will be leveling off or decreasing, is that new government projects like the nuclear bomber are of particular interest to these firms.  In a period of level or declining weapons spending, landing a deal for up to 100 bombers at $550 million or more per copy would be a major win for any of the three companies discussed in this section.[38]

Submarine contractors: There are only two companies capable of producing a next-generation ballistic missile submarine, General Dynamics and Huntington Ingalls Shipbuilding.  Table 2 provides data on their revenue and government contracts for 2011.

Table 2: Pentagon Contracts and Federal Contract Dependency of Major Contractors for the Next Generation Ballistic Missile Submarines, FY2011

 

Company

DoD Prime

Contracts, FY2011

Govt Contracts as % of Revenue

General Dynamics

$19.4 billion

72%

Huntington Ingalls

$4.0 billion

100%*

 

*In its 2011 10K report, Huntington Ingalls indicates that “substantially all” of its business is with the U.S. government.

Sources: Federal Procurement Data System, Top 100 Contractors Report for FY2011 and company 10K reports for 2011.

General Dynamics’ Electric Boat division will most likely serve as the prime contractor for the next generation ballistic missile submarine, with Huntington Ingalls involved as a major subcontractor.  At $5 to $8 billion per boat and a plan to build 12 ships, this program could be a central source of revenue for both firms if it goes forward as planned. 

Nuclear Weapons Complex:

Nuclear weapons contracts are among the largest outlays in the Department of Energy budget.  The majority of contract dollars are awarded to firms like Lockheed Martin, Bechtel, Babcock and Wilcox, and Los Alamos National Security LLC that are integrally involved in the nuclear weapons complex (see table 3, below).  Some firms, such as Savannah River Solutions, LLC and UT-Batelle, LLC receive contracts primarily for nuclear cleanup work, but the majority of firms listed in Table 3 (below) receive the bulk of their funds for research, development, design and maintenance of nuclear warheads.

Table 3: Department of Energy Contractors Involved in Nuclear Weapons-Related Work, FY2011

Company

Contracts ($ millions)

Lockheed Martin

2,716.0

Los Alamos National Security LLC

2,504.9

Babcock and Wilcox

2,057.4

Bechtel Group, Inc.

2,009.3

Battelle Memorial Institute

1,619.8

Lawrence Livermore National Security LLC

1,574.8

URS Corporation

1,465.8

UT-Batelle LLC

1,287.7

State of California

795.5

Savannah River Solutions LLC

764.5

Honeywell International

652.8

CH2M Hill Companies Ltd.

635.3

Shaw Group

516.9

National Security Technologies

510.9

 

SOURCE: Federal Procurement Data System, Top 100 Contractor Report, FY2011.

The Nuclear Weapons Lobby: A Proliferation of Organizations

The nuclear weapons lobby is not a monolithic entity.  It consists of a network of overlapping organizations that include members of Congress, retired military personnel, and weapons producing corporations in various combinations.  Some relevant lobbying groups are described below, with a focus on bombers and submarines.

The Submarine Lobby:

The largest organization with a submarine-specific focus – as opposed to an interest in shipbuilding more generally -- is the Submarine Industrial Base Council, a body which claims to speak for “the more than 5,000 businesses across all 50 states that make up the nation’s submarine industrial base.”  The organization’s goal is to “educate policymakers and the public about the nation’s ability to design, build and maintain submarines – a highly specialized and unique work force.”[39]

The notion that the nation needs to keep a large cadre of companies and workers in place to maintain the ability to produce nuclear submarines now and in the future is a central tenet of the organization.  Taken to an extreme, it implies that we can never cut back significantly on submarine procurement.  To do so would be to lose the technology and skill base needed to build them in case they are needed at some point down the road, or so the council claims.  In fact, there is evidence to suggest that the unique skills and equipment needed to maintain or revive a submarine production capability are fairly narrow.  These essential skills can be maintained by building prototypes or stretching out existing programs.[40]  As former Under Secretary of Defense Paul Kaminsky noted, “We need not procure new systems to maintain many of our military-unique capabilities.”[41]

The  Submarine Industrial Base Council’s Web site includes a “Congressional Packet” that consists of concise fact sheets, quotes from validators such as key members of Congress and retired admirals, and, not surprisingly, an article from the industry-backed Lexington Institute.  One of the group’s main activities is an annual Congressional lobbying event dubbed “supplier days,” and described as follows: “Supplier Days is a great opportunity for you to personally convey the important messages of the submarine industrial base to your members of Congress and to meet with Electric Boat and Newport News Shipbuilding management, US Navy officials, the Submarine Industrial Base Council leadership and fellow suppliers.”[42]

In March of 2012, 300 representatives of the council descended on Capitol Hill to press for $150 million for long lead-time components for a new ballistic missile submarine, funds that would be allocated in addition the Navy’s $585 million FY2013 request for R&D on the ship.  “We really want to get to Congress and make certain they understand the significance of the strategic deterrent” a new ballistic missile sub would provide, said Dan DePompei of Dresser-Rand industries, the co-chairman of the council.[43]

There are no dues to join the council.  Operating expenses are paid for by the Electric Boat Division of General Dynamics, the company most likely to build the next generation ballistic-missile firing submarine.

Working parallel to the Submarine Industrial Base Council is the Naval Submarine League, which describes itself as “the professional organization for submarine advocates.”  It is financed by 58 “corporate benefactors,” ranging from Advanced Acoustic Concepts, LLC, to General Dynamics, to Northrop Grumman, to Oceaneering International.  The group’s board of directors includes an impressive array of former admirals, vice-admirals, and other naval officers.  Main activities include annual symposia on the history, technology, and current status of the U.S. submarine force; putting out its own publication, The Submarine Review; and holding “Corporate Benefactors Recognition Days” that bring together companies involved in submarine production with key Navy officials.

The Navy League is another major advocate of building the next generation of ballistic missile submarines (SSBNs).  With 60,000 members and 250 chapters – mostly composed of retired personnel from the Navy, Marines, or Coast Guard – the Navy League is well positioned to bring pressure to bear on Congress and the Executive Branch on behalf of its agenda.  Like all of the organizations that form part of the submarine lobby, it has generous corporate support, with 247 corporate partners, including 25 “Corporate Gold members” who are the largest financial contributors to the organization.  Seven of the 25 corporate gold members are among the major nuclear weapons contractors profiled in this report: Boeing, Fluor Corporation, General Electric Marine, General Dynamics, Honeywell, Lockheed Martin, and Northrop Grumman.  Each gold member makes an annual contribution of $15,000 to the Navy League.

As its name suggests, the Navy League is concerned with the full range of government shipbuilding initiatives, not just SSBNs.  Its optimum goal is to move towards a 307-ship Navy, up from the current inventory of 285 ships.[44]  The league also proposes to raise the annual shipbuilding budget to over $20 billion per year, a one-third increase from the current level of roughly $15 billion per year.[45]  These goals are unlikely to be met in the current fiscal climate, but the Navy League’s push for these spending levels may result in annual shipbuilding budgets that are higher than those currently envisioned.

On the issue of the SSBN, the Navy League has very specific objectives.

In its maritime policy statement, the league asserts that “the ballistic-missile submarine program must be recapitalized in a timely manner and funded as a national program outside of the Navy’s SCN account.” [emphasis added].[46]  The reason the Navy League supports a separate budget line for the SSBN’s is clear – their enormous cost:

The Ohio SSBN replacement is under design, with efforts to restrain the costs yet to meet the expected operational demands.  This development and construction program, if allowed to remain in the Navy’s SCN funding accounts, will create havoc with other vital construction programs.  These costs should be a national strategic program off the Navy’s funding books.[47]

In addition to these outside organizations, there are two caucuses within the Congress that attempt to exert leverage on behalf of higher shipbuilding budgets in general and spending on ballistic missile submarines in particular.  The Congressional Shipbuilding Caucus is the larger and more influential of the two.  It is co-chaired by Rep. Rob Wittman (R-VA), who has a strong interest in the welfare of the Newport News, Virginia shipyard, which is one of two main construction sites for a next-generation SSBN.  The other co-chair is Rep. Joe Courtney (D-CT), who has the General Dynamics Electric Boat submarine plant in his district.  According to its web site, the caucus has 74 members representing 29 states.[48]  Ten of the members are from Virginia, home of Huntington Ingalls’ Newport News shipyard. Given its numbers, the caucus offers a useful core for efforts to sustain or expand funding for ballistic missile submarines.  This presumes that the caucus is not split in the event of a battle within the shipbuilding budget between surface ships and submarines – a fight that is likely to occur if the ballistic missile submarine doesn’t get its own budget line.

Finally, there is the Submarine Caucus, for which the SSBN is obviously a top priority.  It doesn’t have its own Web site, and at 16 members it is much smaller than the shipbuilding caucus.  It has four co-chairs, including Representatives Wittman and Courtney – the co-chairs of the Shipbuilding Caucus – as well as Rep. Randy Forbes (R-VA) and Jim Langevin (D-RI).  Forbes, whose district is close to the Newport News shipbuilding facility, has also been a major advocate of higher military budgets generally, alongside House Armed Services Committee Chairman Howard P. “Buck” McKeon (R-CA).  In particular, Forbes has helped spearhead efforts to hold off the so-called sequester – the over $500 billion in additional reductions in Pentagon spending plans over 10 years that would be triggered if Congress does not come up with an adequate deficit reduction package.[49]  If the sequester or some version thereof is implemented, it will put that much more pressure on the shipbuilding budget and make a next-generation SSBN even less affordable.

The Bomber Lobby:

The bomber lobby does not involve as many distinct organizations as the submarine lobby, but it has one crucial advantage: the Air Force Association.  It is an $18 million per year operation with nearly 100,000 members.  Although technically a 501©3, nonprofit organization, the AFA is one of the most effective advocacy groups in Washington.  As it notes in its annual report, under the heading “Educating Lawmakers and Their Staffs,” AFA’s “congressional outreach programs” include “briefings, targeted meetings, and Secretary/Chief of Staff of the Air Force receptions reaching hundreds of Congressional staffers and members, with attendance increasing at virtually every event.”  Its top issues for 2012 include “field[ing] a new bomber well before current B-52 and B-1 bomber fleets go out of service.”  But the AFA also speaks out on issues related to the nuclear warhead complex, calling, for example, for funding for multi-billion dollar “life extension programs” for existing warheads and billions more for what it describes as a “responsive infrastructure to deter, assure, and provide stability.”[50]  As noted above, independent analysts have questioned the need for these expenditures.

AFA’s President and CEO Michael M. Dunn is a former Secretary of the Air Force and has been an aggressive advocate of increasing spending on combat aircraft, including long-range bombers.   The organization receives hundreds of thousands of dollars per year in corporate donations, with the top donors including Boeing (over $200,000 per year), Northrop Grumman (in the $100,000 to $199,000 range per year), Lockheed Martin (between $50,000 and $99,000 per year), and Honeywell ($50,000 to $99,000).[51]

In parallel to the AFA, there is a Congressional Long-Range Strike Caucus that advocates for funding not only for nuclear and conventional bombers but for Intercontinental Ballistic Missiles and cruise missiles as well.  Similar to the submarine caucus, the long-range strike caucus has no Web site.  It does not even post a formal list of members.  However, inquiries with key Congressional offices and reviews of key Congressional statements suggest that the caucus has had as  many as 15 members in recent years, although four of these were either defeated or chose to leave Congress after the 2010 elections.  The co-chairs of the caucus are Rep. John C. Fleming (R-LA), a House Armed Services Committee member whose district hosts the new Global Strike Command at Barksdale, Louisiana Air Force Base; and Delegate Madeleine Z. Bordallo of Guam, the site of a major B-52 bomber base.   Four other Republican representatives from Louisiana are also members of the caucus – Steve Scalise, Rodney Alexander, Charles W. Boustany, and Bill Cassidy.  Missouri, home of Whiteman Air Force Base, which hosts the B-2 bomber, is represented in the caucus by Republican representatives Todd Akin and Blaine Luetkemeyer.  By far the most important member of the Long Range Strike Caucus is House Armed Services Committee Chairman Rep. Howard P. “Buck” McKeon, who has Northrop Grumman’s B-2 stealth bomber facility in his district, and who has been the recipient of over $800,000 from the major nuclear weapons contractors profiled in this study over the course of his career. Lockheed Martin and Boeing – competitors for the new nuclear bomber project – have also made contributions to the campaign of Buck McKeon’s wife, Patricia, who is running for the California State Assembly.[52]

The ICBM Coalition:

There is also a Congressional network that advocates for the third leg of the nuclear triad, Intercontinental Ballistic Missiles (ICBMs).  The group consists of members of the Senate whose states either house bases where Minuteman III ICBMs are located or have significant-ICBM related work in their state. The ICBM bases are located in Montana, North Dakota and Wyoming.  As a result, caucus members include Senator Jon Tester (D-MT); Sen. Max Baucus (D-MT); Sen. Kent Conrad (D-ND); Sen. John Hoeven (R-ND); Sen. John Barrasso (R-WY); and Sen. Mike Enzi (R-WY).  Maintenance on Minuteman III’s is done at Hill Air Force Base in Utah, and Alliant Techsystems (also known as ATK) produces Minuteman III Stage 1 motors as part of its Minuteman Solid Rocket Motor Warm Line (SRMWL) program at ATK's test facility in Promontory, Utah. [53]  This work helps account for the membership of Utah Republican Senators Orrin Hatch and Mike Lee.  Sen. Conrad and Sen. Enzi are co-chairs of the ICBM coalition.

The coalition is vigilant in its opposition to any changes that might reduce the number of ICBMs in the U.S arsenal to levels that might threaten the existence of current ICBM bases.  For example, a February 2012 press release from Sen. Jon Tester’s office lists a series of letters to the Obama administration and meetings with key administration officials such as Secretaries of Defense Leon Panetta and Robert Gates and Vice President Joe Biden designed to “ensure ICBM funding is maintained throughout the budget process.”  This includes advocating for the highest possible levels of ICBMs in the U.S. arsenal even after reductions in deployed warheads required by the New START nuclear arms reduction treaty.  Current plans call for a modest decrease in deployed ICBM’s from 450 to 420 as part of the implementation of New START.  The ICBM coalition has urged that the remaining 30 silos stay in a “warm status,” ready to deploy ICBMs if required at some future date.  This policy would mean that no ICBM silos would be destroyed.[54]

Baucus and Tester have argued that if there are to be additional cuts in nuclear delivery vehicles, the Pentagon should go after the other legs of the nuclear triad, bombers or ballistic missile submarines:

ICBMs are by far the most cost-efficient leg of the nuclear triad. The ICBM fleet provides a critical deterrent because of its considerable survivability. Unlike an attack on the submarine or bomber leg of the triad, an enemy would be required to strike deep within the continental United States in order effectively eliminate ICBM strike capability. Such a visible, highly dispersed force creates a powerful disincentive for any adversary while also providing clear reassurance to our allies, many o f whom have chosen not to pursue their own nuclear arsenal because o f the security provided by America's nuclear umbrella.[55]

This suggests the possibility that if a combination of policy and budgetary and policy changes result in significant cuts in the U.S. nuclear arsenal beyond New START levels, the lobbies for each leg of the nuclear triad might spend as much or more time fighting each other as they would fighting for a status quo in the levels of U.S. nuclear weapons overall.

  BUYING INFLUENCE: CAMPAIGN CONTRIBUTIONS AND THE REVOLVING DOOR

Campaign Contributions by Nuclear Weapons Contractors:

There are dozens of members of Congress who play major roles in deciding how much funding goes to specific nuclear weapons-related projects, but some have far more influence than others.  The key committees that deal with nuclear weapons-related funding are the Energy and Water Subcommittees of the House and Senate Appropriations Committees; and the Strategic Forces Subcommittees of the House and Senate Armed Services Committees. 

The Energy and Water Subcommittees deal with the nuclear weapons complex, including projects such as the Uranium Processing Facility (UPF), the Chemical and Metallurgy Replacement Nuclear Facility (CMRR-NF), and the Mixed Oxide (MOX) facility, all mentioned above.  On the Senate side the subcommittee chair is Sen. Dianne Feinstein (D-CA), and the ranking Republican is Sen. Lamar Alexander (R-TN).  Sen. Feinstein’s state is home to the Lawrence Livermore nuclear weapons laboratory, and Sen. Alexander’s state is home to the Oak Ridge National Security site, which includes the UPF project.  On the House side the Energy and Water Subcommittee is chaired by Rep. Rodney Frelinghuysen (R-NJ).  The ranking Democrat is Rep. Pete Visclosky (D-IN).

The Strategic Forces Subcommittees deal with nuclear delivery vehicles such as submarine-launched ballistic missiles (SLBMs) and intercontinental ballistic missiles (ICBMs), along with related programs such as missile defense.  On the Senate side the subcommittee is chaired by Sen. Ben Nelson (D-NE), whose state is home to the Strategic Command (Stratcom), and the ranking Republican is Sen. Jeff Sessions (R-AL), whose state hosts a large cluster of missile defense contractors in and around Huntsville. On the House side the subcommittee is chaired by Rep. Michael Turner (R-OH), one of the most aggressive advocates of increased spending for nuclear projects of all sorts, whether they relate to warheads or delivery vehicles.  The ranking Democrat is Rep. Loretta Sanchez (D-CA).

Other major players with decision making power over nuclear weapons spending include House Armed Services Committee Chair Rep. Howard P. “Buck” McKeon, who has facilities of all the three competitors for a new nuclear bomber in his district – Boeing, Northrop Grumman, and Lockheed Martin; and Rep. Norm Dicks (D-WA), who has on occasion been called the “Representative from Boeing” due to his relentless advocacy for his home state firm.  Rep. Dicks is the ranking Democrat on the Defense Subcommittee of the House Appropriations Committee.  Last but not least is Sen. Jon Kyl (R-AZ), a central player in o

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