So good is terrorism proving for the contracting business, that it is hard to imagine the single-minded focus on the terrorist threat subsiding anytime soon. Five years after the 9/11 attacks, the Department of Homeland Security (DHS) was spending $28 billion a year on well over one hundred thousand contracts, while a staggering amount of taxpayers’ dollars was being squandered by the homeland security giants. In 2011 the Los Angeles Times reported that DHS spends a whopping $75 billion a year.
Take just one project, the Secure Border Initiative Network (SBInet) – a plan for a “virtual fence” with sensors, cameras and other high tech gear along the border with Mexico. Boeing beat out Lockheed Martin, Northrop Grumman and Raytheon to win the contract from the Department of Homeland Security in 2006.
The work was estimated to cost $2.5 billion. It soon ballooned to $8 billion, with the final cost predicted to be as high $30 billion.
Over three years, the DHS spent $1.1 billion on SBInet and had nothing more to show for it than an error-prone 28 mile stretch of “virtual fence” in Arizona. A 2010 Government Accountability Office Report blamed Boeing for failing to provide reliable data on the program and its costs, as well as the poor management and lack of oversight provided by the DHS. The project was put on hold.
Failure on this scale was not new for Boeing, which is the nation’s number 2 defense contractor. Its explosive detection devices were removed from airports because of the high percentage of false positives. Its involvement in the disastrous $300 million “Railhead” project to fix endemic problems with the National Counterterrorism Center’s TIDE database showed how difficult it was to make complex IT systems work, and how easy to cream off public dollars for private purposes. In spite of its dismal homeland security record, Boeing won the contract in 2009 to staff the Seattle Fusion Center.
In late October 2010, the DHS was sued by the American Small Business League for refusing to release subcontracting reports on contracts awarded to Boeing which, it believes, could prove collusion between Boeing and the DHS to circumvent federal law that requires 23 percent of federal contracts to go to small business. The League brought similar FOIA lawsuits concerning DHS’ dealings with Lockheed Martin and other major defense contractors.
Lockheed Martin, which reportedly received $36 billion in government contracts in the single year of 2008, is in a league of its own as a “Twenty-First Century Big Brother.”
Find out more about homeland security contractors.
See more information on the 10 biggest contractors. Check out Top Secret America's list of “security” related corporations based in tech-heavy Massachusetts.