9/25/2001

In late September 2001, “Boeing executives met with Darlene Druyun, then deputy assistant secretary of the air force for acquisition. Boeing was facing severe financial difficulties in the wake of the airline slump that followed 9/11 and was looking for a bailout. It was therefore agreed at this and subsequent meetings that the air force would acquire one hundred aerial refueling tankers from Boeing, but instead of buying them in the normal fashion, the planes would be leased, a much more profitable deal for Boeing. Structured in this fashion, the $26 billion deal cost the taxpayers as much as an extra $10 billion, for planes the air force did not actually need. …While negotiating with Boeing on behalf of the government, Druyun was simultaneously negotiating with Boeing for a $250,000-a-year postretirement job for herself. Others who involved themselves in the affair also forgot to declare conflicts of interest. [Defense Policy Board Advisor] Richard Perle, for example, coauthored an article in the Wall Street Journal touting the proposed deal as vital to defense transformation, but failed to mention that Boeing had invested $20 million in Trireme Partners, a venture capital firm Perle had launched in November 2001 to capitalize in investment opportunities arising out of the war on terror. Ultimately, following an unrelenting effort by Senator John McCain [R-AZ] to uncover the truth and a series of reports by the Defense Department’s inspector general, Druyun and a Boeing executive went to jail. …Asked by Senator John Warner (R-Va.) whether, in thirty-three years of government service, he had ‘ever seen a deal as dirty as this one,’ the chief auditor of the Pentagon’s Inspector General’s Office replied, ‘No sir, I have not.’ Boeing ultimately paid a $615 million fine.” [The 25th of the month used for date sorting purposes only.]

 – Andrew Cockburn, Rumsfeld, Pages 208-209