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Paddy Warbucks 

Senator Patrick Leahy brings home the bacon - but is Pentagon pork good for Vermont?

It's almost 5 p.m. at the Mine Safety Appliances plant in Newport and George has taken a lot of flack at work today. Now, he's about to take a 9-millimeter bullet to the forehead.

"George" is the dummy human head MSA uses in its ballistics lab to test the Kevlar helmets it makes for the U.S. Army. Each day, MSA subjects its helmets to all kinds of abuse - shrapnel fire, falling weights, impacts from every direction - to make sure they meet or exceed the Army's rigorous performance standards.

Running this afternoon's test is Greg Good, MSA's quality-control engineer. He places a newly minted helmet on the dummy head and aims a mounted gun barrel with a red-laser sight, then steps behind a bullet-proof glass wall. After a loud gunshot, he returns to inspect the damage.

"That looks like the extent of it," says Good, pointing to a dimple in the helmet's surface where the bullet is now lodged. There's also a slight dent in the clay head less than a quarter-inch deep - well within the Army's specs, he notes.

Neither Good nor Plant Manager Rudy Chase, who's also been watching the test, can say what kind of injuries "George" would have sustained had he been a real soldier on the battlefield. But they've heard tales from troops in Iraq and Afghanistan who have survived similar ordeals.

In December 2004, for example, the MSA plant was visited by an Army Green Beret captain from Greensboro who was shot in the head at point-blank range with an AK-47. Only the tip of the bullet penetrated his helmet. He received a bloody head wound and blurred vision, but eventually made a full recovery. When his mother toured the ballistics lab and watched a similar demonstration, she broke down and cried.

"When we save someone's life this close to home, it's very rewarding," Chase says about the Green Beret, who asked not to be identified. "It puts it into perspective why we're in business."

About 10,000 helmets roll out of this factory each month - virtually every one of them for the U.S Army. Last year, MSA won a $27.9 million contract with the U.S. Department of Defense (DoD). This and other military contracts are expected to keep the plant, which employs about 60 people, operational through at least 2010.

Those contracts are due in large part to the efforts and political clout of Senator Patrick Leahy (D-VT). Leahy, who was first elected to the Senate in 1974, is a senior member of the Senate Appropriations Committee and its Defense Subcommittee, which oversees the drafting of the annual defense budget. Needless to say, he has considerable say over how, and where, Pentagon dollars are spent.

Leahy has been an outspoken critic of the Iraq war and the Bush administration's handling of the global "war on terror." At the same time, he's also taken credit for helping many Vermont companies win lucrative contracts with the U.S. military - more than $1.6 billion worth since the invasion of Iraq in March 2003. And that tally doesn't include other defense-related appropriations Leahy has brought home in recent years, such as $8 million for the Vermont National Guard's "Cyberwar School" and $35 million for its Black Hawk helicopter hangar and armory at Burlington Airport, among others.

Admittedly, Vermont's slice of the Pentagon pie is minuscule by national proportions. In 2005, the state received $407 million in DoD procurements, or just 0.17 percent of that year's total defense contracts. Far below such military heavy-hitters as California ($31 billion), Virginia ($26 billion) and Connecticut ($8.7 billion), Vermont ranks 45th in the nation for the amount of defense dollars it gets. For comparison, Vermont's ski industry is worth about $1.5 billion annually, tourism about $1.46 billion, and agriculture, about $2.6 billion.

Nevertheless, like the federal defense budget as a whole, Pentagon dough is on the rise in Vermont, going from $243 million in 2000 to a record $455 million in 2004. And in a small state, a little goes a long way. From Newport to Brattleboro and Bennington to St. Johnsbury, companies large and small are deeply invested in the war economy.

The trend raises some difficult questions for Vermonters. Will this state's political and economic landscape change as it becomes more reliant on Pentagon pork? Are the jobs created by defense contractors better or worse than those created by the civilian sector? Are all military contracts created equal, or should Vermont only seek out those companies making clean, high-tech products that have both military and civilian applications - so-called "dual-use technologies?" Finally, how does it affect Vermont's historically antiwar ethos as more and more of its employers are, as one Vermonter put it, "suckling at the Pentagon's teat"?

Much of the defense spending in the Green Mountain State is out of sight, and mind, for the average Vermonter; even in fiercely antiwar Burlington, many residents probably know little or nothing about two of the state's largest military contractors in their own backyard: General Dynamics of Burlington and Goodrich Aerospace of Vergennes. Together, these two companies employ more than 1200 people in highly skilled, high-paying jobs.

But many other smaller, high-tech firms scattered throughout Vermont also work for the military, mostly through contracts secured with the help of Leahy and his staff. In August, the senator's office announced that it helped Mobile Medical International of St. Johnsbury secure a $7.1 million contract with the Army to build rapidly deployable medical shelters for use in war zones. These 21st-century M.A.S.H. units can provide everything from a 500-bed infirmary to an operating room and intensive-care unit - all of which can be assembled in less than 15 minutes.

One week earlier, Leahy announced that he'd helped Revision Eyewear of Williston land a $4 million contract to supply the Army with 100,000 sets of special-purpose ballistic eyewear. These glasses protect troops from eye injuries caused by hazards such as sandstorms and improvised explosive devices.

And in March, Leahy announced that he and Senator Jim Jeffords (I-VT) had helped two Windsor firms win DoD contracts totaling more than $10 million. The first, a $7.5 million contract with Seldon Laboratories, is being used to build state-of-the-art water-filtration systems for the Air Force. The second, a $2.8 million contract with Olympic Precision, Inc., is being used to build a National Center for Precision Manufacturing, which will help the Army develop advanced manufacturing techniques for military hardware.

And the list goes on: Motion-tracking devices for the Air Force are made in Milton; Army helicopter engines are built in Rutland; Navy periscopes are produced in Brattleboro. Though some of these companies employ relatively few people, their financial importance to their communities shouldn't be underestimated.

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It's no secret how Vermont businesses get these contracts. As the seventh most senior member of the Senate, Leahy has considerable access to Washington decision-makers, from the Pentagon to the intelligence community to the White House.

As Leahy and Senate staffers explain, there's no set playbook for arranging such deals. Sometimes a Vermont company will approach the senator himself; other times he or his staff will approach them. Over the years, Leahy has put together an economic development outreach team that gets to know Vermont businesses and the products they design and build. These staffers keep track of what the military is looking for, and then seek out Vermont companies that can deliver those goods or services.

Leahy's staff also works closely with the Government Marketing Assistance Center, a state office created specifically to help Vermont companies get federal contracts, mostly with the military.

Sometimes, the Vermont Economic Progress CouCouncil will sweeten the deal by offering those companies attractive tax credits to build their products in Vermont. Just last month, it awarded a $1 million tax break to Israel-based Plasan Sasa, which is setting up shop in Bennington to build protective armor for military and civilian vehicles. Since 1999, at least eight other Vermont companies have been offered similar tax incentives for defense-related work.

Leahy and his people also arrange the meetings with key policymakers. Technically speaking, the senator and his staff don't review the companies' bids or write their contracts. However, they can get the money earmarked in a defense-appropriations bill and deposited into an account that only one company can access.

MSA is a good example. Several years ago, the Army was looking to replace its Vietnam-era steel helmets with a design that was newer, lighter weight and more resilient. Leahy's staff approached MSA about building a limited number of helmets for the Army's Special Forces. After they got rave reviews, the Army decided to issue them to all of its troops, but didn't have money for it allocated in its budget. That's when Leahy stepped in.

Leahy insists he doesn't go to bat for every defense contractor just because it's located in Vermont. He says he must first be convinced that it's in the best interest of the state, the military and national security.

"I was up for re-election in a difficult race a number of years ago, and the B-2 bomber was a big issue," the senator recalls. In the early 1990s, the Pentagon deliberately tried to put many contracts for B-2 components in Vermont in an effort to win his support, he says.

"Ads [about the bomber] were run against me in my campaign," Leahy adds. "But I voted against it because I thought it was a total waste of money. And, as history has proven, I was right."

As for MSA's helmets, Leahy says he's "delighted" they're built in Vermont, especially in a part of the state where jobs are hard to come by. As he puts it, "This one was a no-brainer."

Not surprisingly, Vermont communities welcome these businesses with open arms. In Newport, a town of some 5000 people not far from the Canadian border, MSA is one of the largest employers in the area. Nevertheless, many local residents seem to know little about it. But those who do say they have no qualms about tapping the Pentagon's cash pipeline.

"Everybody in Newport will tell you the same story," says Bill Smith, 70, a semi-retired Newport businessman who installs home-security systems. "Where do my kids live? California, Florida, New Hampshire, Burlington. What are you going to do up here unless your parents own a business?"

State Rep. Winston Dow- land, a Progressive from the nearby town of Holland, says that Orleans County has a lot of poor people who will take whatever jobs they can find.

"I don't agree with this war, but I agree that we need to keep buying this stuff," Dowland says. "People are just interested in making a living and trying to feed their families."

Newport City Manager John Ward knows something about defense contracts. He spent 19 years working for Phoenix Engineering of Newport designing large-caliber guns and bullets for the military. Defense work, he says, is "feast or famine," but communities like his can't afford to be choosy.

"We'll take anyone who wants to come, and we'll be happy to get them," Ward says. "We just need jobs up here . . . so long as they don't pollute."

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Assessing the broader economic impact of military spending on Vermont isn't easy, even for economists. No state or federal agency tracks the flow of defense dollars into Vermont - not because the number is trivial, but because it's so hard to get a handle on where the money eventually ends up.

IBM is a good example. The company isn't listed as a Vermont DoD contractor in the Federal Procurement Data System. Nevertheless, it could be producing millions of dollars' worth of computer chips for companies in other states that build components for the military. On the flip side, General Dynamics is listed in the data system with hundreds of millions of dollars in Vermont contracts. However, only a small fraction of that manufacturing may actually occur within the state.

Tom Kavet of Kavet, Rockler and Associates is an economist for the Vermont Legislature who's also done consulting work for the Defense Department. He explains that from a purely economic standpoint, there are some advantages to having military contractors in your area.

Wages and benefits in those industries tend to be good, he says, the products are sold almost exclusively outside the state and, like it or not, defense is a high-growth sector. Also, while it's difficult for a company to land a military contract, once it has one, the DoD tends to stay with that company rather than shopping around for other suppliers.

In addition, Kavet says, the defense industry as a whole is somewhat insulated from fluctuations in the national economy and the pressures of international competition. Concerning MSA, he says, "You could do that work in China. But is the Defense Department ever going to let a contract for Army helmets over there? No."

On the other hand, Kavet says, creating a foreign policy that requires the United States to deal with the rest of the world using a big military is economically inefficient in many ways.

"If, as a country, we're making more guns than butter, we could have been using those resources to build schools or bridges or things like that," Kavet says. "And, if you make something that you ship halfway around the world and then it blows up, you completely lose the value of that product."

Burlington economist Doug Hoffer has examined the use of military spending as an economic engine. Though he admits he's no expert on military procurements, he's found that traditional defense-related industries don't have as powerful a "multiplier effect" in the Vermont economy as do most civilian industries. That is, most civilian industries are better at creating new jobs, stimulating growth, and re-circulating wealth to other Vermont businesses.

For instance, according to Hoffer's calculations, a $1 million increase in cheese manufacturing results in $2.61 million in total economic output. In contrast, a $1 million increase in spending on aircraft and missile engines results in only $1.74 million in total economic output. Likewise, $1 million spent on ordnances and accessories production creates just a $1.47 million boost for the Vermont economy.

The reasons are self-evident, Hoffer says. "Unlike consumer goods, these things are dead-end items," he points out. "Once you build an F-16, it's not part of the consumer economy. It's just hanging around."

Hoffer doesn't fault economic development officials, or Leahy, for trying to bring home the bacon. "What's Pat Leahy going to say? 'No, I don't want to help my constituents?' What comes to Vermont are crumbs, by national standards. But everybody wants those crumbs."

And almost everybody gets some. Since the end of the Cold War, the Defense Department has spread the money around to virtually every congressional district in the country, buying jobs and goodwill. As a result, decisions about what the military buys are more often determined by political expediency than by need. Defense spending becomes a de facto jobs program, forestalling any discussion on more cost-effective ways of outfitting the military or defending the country.

Joseph Gainza is a peace activist with the American Friends Service Committee in Montpelier. Though he respects Leahy's stance on many issues, he has serious concerns about Vermont's economy becoming inextricably bound to out-of-control military spending.

Gainza points to a May 2005 press release from Leahy's office, which touts a $900 million contract given to General Dynamics to build Hydra-70 rockets for the Army. According to the press release, "The Army intended to scale back production of the rocket system in 2003, but Congress, led by Leahy's efforts, was instrumental in reversing that decision, based on its continuing usefulness and proven track record."

Gainza wants to know why Congress would continue funding a weapons system that the Army said it didn't want or need. "Were Mr. Leahy and his colleagues thinking in terms of usefulness," he asks, "or what effect it would have on the Vermont economy?"

But Leahy justifies his support for the Hydra-70, saying that he was hearing from commanders in the field that they wanted that weapons system. However, he claims that its funding was cut by the Bush administration to pay for other, unproven weapons, such as the "Star Wars" anti-missile system.

"If General Dynamics does something I disagree with, I vote against it," Leahy says. "I have, and they know it."

Gainza isn't suggesting that American troops should go into battle without the best weapons and equipment available, whether they are helmets from Newport, eyewear from Williston or Gatling guns from Burlington. But he wonders if it's healthy for Vermont's economy to be so dependent upon a war budget.

"That's a good question. I ask myself that all the time," Leahy says. "That's why we're trying to push more and more for the dual-use [technologies], because you don't want to just be reliant on a war economy."

Gainza counters that such logic obscures the bigger issue. Notably, the militarization of the U.S. economy and its "addiction" to a $500 billion annual military budget, when other human needs - health care, education, the environment, alternative energy research - go wanting.

"I can't help but think it's going to affect the way people view warfare," Gainza says. "They may not like it, but they'll consider it a necessary evil.

"Somebody once said that if the only tool in your toolbox is a hammer, every problem begins to look like a nail," he adds. "When one trillion dollars per year of the world's wealth is being spent on military hardware, it limits your other choices."

*********

No one interviewed for this story characterized Leahy as a war hawk or a pork-barrel politician. His record on trying to limit the damage associated with warfare is well documented. In 1989, he created the Leahy War Victims Fund to aid civilians injured by landmines, war and civil strife. The "Leahy Law" prohibits U.S. aid to foreign militaries and police forces that violate human rights. Last month, he co-sponsored an amendment to the 2007 defense-budget bill that would have prevented U.S. tax dollars from being used to buy or transfer American-made cluster bombs until the Pentagon adopts rules of engagement ensuring they're not used on large concentrations of civilians. And most recently, Vermont's senior senator sponsored legislation to make war profiteering a crime.

Still, there's no escaping the reality that federal defense spending is like a runaway train - and Congress is in the best position to pull the brakes. Winslow Wheeler of the Center for Defense Information argues in the September issue of Mother Jones that much of that unfettered spending is the result of billions in congressional add-ons to the defense-appropriations bill.

Next year, the United States will spend at least $513 billion on its military, more than all the other countries of the world combined. Meanwhile, profits in the defense sector have shot up more than 25 percent in the last year alone. As Vermont filmmaker Eugene Jarecki puts it in his award-winning 2005 documentary, Why We Fight, when war becomes that profitable, we're going to see more of it.

"If peace were to break out tomorrow, if we were to have what everybody prays for and hopes for and every head of state says they want, how many local economies in this country would just collapse?" Gainza asks. "Is that an incentive to have peace, or to keep things the way they're going?"

Vermont may never be better known for its guns than its butter. But many Vermonters may soon begin asking themselves - and their elected officials - which one gives them the biggest bang for their buck.

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About The Author

Ken Picard

Ken Picard

Bio:
Ken Picard has been a Seven Days staff writer since 2002. He has won numerous awards for his work, including the Vermont Press Association's 2005 Mavis Doyle award, a general excellence prize for reporters.

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