Friday, March 21, 2008

Pace Exemplifies Dwight’s Nightmare

President Eisenhower’s dreaded military industrial complex is embodied in General Peter Pace, fresh off his service as Chairman of the Joint Chiefs of Staff. Within months after retiring last October, Peter landed a job as President of SM&A Strategic Advisers, Inc. SM&A bills the publicly traded firm as leading consultants in competitive procurement. Pete’s new company has numerous success stories in government defense. In a recent UPI interview, General Pace highlighted the current transformation of the Defense Department and how SM&A could assist companies wanting more government business.

" … It's not about problems in the past, it's about opportunities in the future and how we can help the leaders of companies understand the process and how to properly pay attention to the specifics of what the government asks for, and then help them (defense contractors) craft programs that are focused on answering the issue or requests for proposals that's before them."

What makes Peter’s new job interesting is his employment arrangement. This ex-insider doesn’t have to work full time for his $240,000 sign on bonus and $300,000 a year base salary. The SEC filing indicates a chance for significant incentive compensation and showed a 100,000 share stock option award. Also, as board member for the parent company Pace will earn $20,000 a year for his service. For that first year of non-full time work, Peter will garner $560,000. Why would a company pay that kind of money to a part timer? Could it be for insider intelligence to grow revenues at the government’s expense? As President Bush frequently says, “that’s your (taxpayer) money.”

George W. also wants Peter’s intelligence, having just appointed him to the President’s Intelligence Advisory Board. Peter's services seem to be in great demand. What kind of insider information can General Pace get in his Intelligence position that will help SM&A clients? The UPI piece mentioned a Defense Department failure, the much maligned $4 billion Future Intelligence Architecture program. What intelligence needs remain unmet given that debacle? How will the man who played a role in that failure steer work to his new firm's clients? I hope these questions aren't too critical as General Pace is sensitive to such "personal venom".

But one man's personal venom is another's person enrichment. There's influence to be bought and sold in our nation's capital. Peter Pace serves both sides of the military industrial complex (MIC), while his new company milks the even larger government industrial monstrosity (GIM). The revolving door keeps swinging and the cash register keeps ringing.