Grand Rapids Area Companies Awarded $813,663 in Military Contracts in June

In June of 2006, Grand Rapids area companies were awarded $813,663 in military contracts for a variety of items including components for military aircraft and electronic targeting devices for weapons. The contracts awarded this month were:

• $186,660 to L-3 for an attitude indicator for use by the Navy.

• $90,000 to Smiths Aerospace for the repair and/or modification of a signal recorder for the Navy.

• $203,632 to Eaton Aerospace for an actuator for the Navy.

• $181,038 to RSL Electronics for fire control computing sights and devices.

• $107,000 to Modern Fire & Security Systems for fire alarm upgrades at the United States Coast Guard air station in Traverse City.

  $45,333 to Hollymatic Corp for kitchen equipment for the Department of Veterans Affairs.

It is also worth noting that work will be completed in nearby Whitehall on a nearly $43 million contract to Raytheon Missile Systems for the XM982 Excalibur Unitary Guided Projectile.

As has been the case over the two years that Media Mouse has been monitoring military contracts given to Grand Rapids companies, there was little to no reporting on the contracts in the local media. While Media Mouse has seen contracts announced in the local media in the past, this month there was no reporting on the contracts, some of which were weapons components that will be used by the United States’ military in its continuing “war on terror.” Moreover, the awarding of contracts to companies such as Hollymatic Corp and Modern Fire and Security Systems illustrates the vast infrastructure needed to support the United States’ military and the ways in which companies aside from those in the “defense industry” play a vital role in maintaining the United States’ capacity as an imperial power, in addition to benefiting from the military-industrial complex.

Borisch, Eaton Aerospace Awarded $149,000 in Military Contracts in May

The electronics company Borisch Manufacturing and the aerospace company Eaton Aerospace received a combined total of $149,511 in military contracts during the month of May according to research conducted for Media Mouse’s Military Contracts database that tracks military contracts awarded to companies in the Grand Rapids area. This is the smallest number of contracts awarded since the database began in February when $2.6 million in contracts were awarded and an amount significantly smaller than the $9.1 million awarded in April.

The following contracts were awarded in May:

• Borisch Manufacturing was awarded a $49,279 contract for the manufacture of small arms to be used by military.

• Eaton Aerospace was awarded a $100,232 contract for a valve check component for the Air Force’s E-3 aircraft.

As has been the case with most military contracts awarded to companies in the Grand Rapids area, the contracts received no media coverage. However, during the month the local media did cover a contract awarded to Nartron Corporation, a company located north of Grand Rapids in Reed City. Nartron Corporation was awarded a $3,958,586.97 contract to upgrade the electronic engine start systems used on Army Humvees. The start system will be installed on all current and future Humvees—a vehicle that is used extensively in Iraq. The coverage given to the contract announcement was brief, with the Grand Rapids Press running a paragraph about it on a side column on the front of the “Business” section and WOOD TV 8 running a short story from the AP. The WOOD TV 8 piece never said the amount of the contract and instead simply emphasized the expansion to Nartron and the 100 new jobs that the company says will be filled immediately to perform the work. Neither story looked at the role of the Humvee in the ongoing occupations of Iraq and Afghanistan, nor did they explore larger questions about the military-industrial complex.

Alternative Annual Report on Halliburton Released

CorpWatch has released an “alternative annual report” for Halliburton, the company formerly headed by Vice President Dick Cheney and one of the major recipients of military contracts related to the Iraq War. The report, titled “Hurricane Halliburton: Conflict, Climate Change, and Catastrophe,” was issued on the eve of Halliburton’s annual shareholders meeting in Duncan, Oklahoma. According to Pratap Chatterjee, the executive director of CorpWatch, “From Iraq to Peru, Halliburton’s sloppy work has contaminated water supplies for soldiers and communities alike. In Nigeria, the company is being investigated for bribery and in Washington DC, Pentagon auditors are examining the company for overbilling.” Despite allegations of misconduct, Halliburton was paid $253 million by the United States government in early 2006 for what were previously disputed costs, a fact that Halliburton has claimed has disproved allegations of war profiteering. The company needs to come clean about its books and clean up its mess.” The report found that:

• Last year the company was paid $5.4 billion for work in Iraq. Over the past five years, US government contract work has brought Halliburton more than over $20 billion–a huge increase over the meager $1.2 billion it was paid for all government work a decade prior (1991-1995). The company has seen its profits in government contracting almost quadruple to $330 million in 2005 compared to $84 million in 2004.
• In 2005 military auditors identified more than $1.4 billion in “questioned” and “unsupported” expenditures by Halliburton in Iraq and Kuwait.5 The Pentagon’s Defense Contract Audit Agency (DCAA) determined that Halliburton had $1 billion in “questioned” expenses (or expenses which military auditors consider “unreasonable”) and $442 million in “unsupported” expenses (or expenses that do not contain any documentation or verification).6 The auditors challenged most of these costs as “unreasonable in amount” because they “exceed that which would be incurred by a prudent person.” By contrast, military audits of most of the Pentagon’s 77 contractors in Iraq have “found only minor cost” problems.
• Six managers and suppliers have been indicted relating to overcharging on Halliburton-related contracts.
• Halliburton was awarded more than $284 million in contracts related to Hurricane Katrina in the fall of 2005.
• In early 2006, its KBR subsidiary was awarded a $385 million contract to build temporary detention facilities in the case of an “immigration crisis.”

Addditionally, the report documents:

• how the company management in Iraq and Kuwait has cheated taxpayers out of millions of dollars through bribery and waste
• how the company has increased its profits in Iraq by employing sweatshop Asian labor and refusing to pay injury claims
• how senior management used worker’s pensions to pay for management benefits, despite the fact that the soaring stock price has made the top managers tens of millions of dollars.
• how its hydraulic fracturing operations in the United States have had disastrous impacts on the environment, including community water supplies
• how its lobbying efforts have prevented legally mandated regulatory oversight.

The annual meeting was moved to Duncan, Oklahoma to avoid protests that have plagued the company at previous annual meetings in Houston. However, a few hundred people protested outside of the meeting in Duncan, where 16 protestors were arrested. Last week, the Yes Men represented Halliburton at an insurance conference and made a mockery of the company.

Grand Rapids Military Contractors Awarded $9.1 Million in Contracts

In April, Grand Rapids area military (“defense”) contractors were awarded $9,149,150 in contracts:

• Eaton Aerospace received a $40,110 contract from the Navy.

• Smiths Aerospace received $9,000,000 for work sub-contracting work through Raytheon on the targeting modules for Marine armored vehicles.

• Dover Resources received a contract for $40,501.

• Steelcase Inc received a $42,831 contract for office furniture from the US Army Aviation and Missile Command.

• Kentwood Office Furniture received a $25,078 contract for furniture from the Army.

This month Borisch Manufacturing also received tax breaks for new construction due to expansions it claims it needs to support the company’s rising sales.

The $9,000,000 contract that Smiths Aerospace obtained from Raytheon is an example of sub-contracting which is a common practice among companies doing military contracting. Large corporations frequently outsource portions of the manufacturing process to other companies so that completed weapons systems often contain components from several different companies. The connection to Raytheon also provides Smiths Aerospace with a further connection to the Iraq War, with Raytheon making “bunker buster” bombs, Tomahawk missiles, Patriot missiles, and components for the “unmanned aerial vehicles” used extensively in “the war on terror.” Of military contractors, Raytheon is one of the top industry political contributors.

Raytheon’s politic contributions also serve as a reminder that military contractors will soon start making extensive political contributions and indeed the “defense industry” has already given $7,343,996 in contributions in the 2006 election cycle. L-3 Communications, a large corporation with manufacturing operations in Grand Rapids, is in the top 10 of “defense” industry contributors to political candidates this year, already giving some $391,270 compared to a total of $400,519 in 2004. According to the Center for Responsive Politics, while the majority of contributions from the military contractors have gone to Republicans since 1989, many contributors give fairly evenly to both parties, thereby demonstrating how both Republicans and Democrats support and are an essential component of the military-industrial complex. Military contractors also spend significant amounts of money on public relations and lobbying efforts spearheaded by groups such as American Defense International, who works with Smiths Aerospace.

Grand Rapids Area Companies Receive $24 Million in Military Contracts in March

Companies either located in the Grand Rapids area or with manufacturing operations in the Grand Rapids area received $24,004,921 in military contracts during March according to documents available from various government sources. This amount is a dramatic increase from February, when $2,614,448 in military contracts were distributed.

The number of contracts and total dollars highlight the variety of ways in which local companies are contributing to “the war on terror” and the occupation of Iraq:

• Cardinal Maintenance Service received a $111,532 contract to providing maintenance services at the Naval air station in Key West, Florida.

• Choice Services received a $9,732 contract for food services for the Air National Guard.

• Eaton Aerospace received three contracts worth $162,960 for components used in military aircraft.

• L-3 Communications received three contracts worth $339,766 to produce military aircraft components for the Air Force.

• Smiths Aerospace received a contract for $16.5 million dollars for components for the F/A-18 fighter.

• Wolverine Worldwide received a $6.8 million contract from the Navy for leather dress shoes.

Additionally, the large military contractor Raytheon received a $16,103,430 contract for thermal sight systems with 10% of the work being completed in Grand Rapids. It is also worth noting that General Dynamics, received a $17 million contract for work on M1A1 tanks with 3% of the work being done in Muskegon.

While military contracts rarely get attention in the corporate media, WZZM 13 did report on Smiths Aerospace’s $16 million contract:

WZZM 13 News Reader – But there is some encouraging economic news tonight, Smith’s Aerospace has been awarded a contract worth an estimated $34.5 million dollars. Smith’s works on various military projects and has operations around the world including Grand Rapids. This contract would last for 5 years and focus on upgrading on logistics systems on various military aircraft. Smith’s says the work will be done at facilities in Michigan and Florida. (Total Time: 24 seconds)

Unfortunately, the story was typical in that it provides no context about what the exactly the contract is for, nor does it provide any information about how the aircraft (the F/A-18) is used in the ongoing “war on terror” and the occupation of Iraq. Similarly, the report essentially is a rehashing of press releases sent to the media by both Smiths Aerospace and the Department of Defense.

Report: Halliburton’s Performance Worsens

According to a new analysis prepared by Representative Henry A. Waxman, Halliburton’s performance has worsened during its work on a contract to restore Iraq’s southern oil fields. The analysis, which draws from undisclosed correspondence, evaluations, and audits reveals that government investigators have harshly criticized Halliburton’s performance and have found:

• Intentional Overcharging: Halliburton repeatedly overcharged the taxpayer, apparently intentionally. In one case, “[c]ost estimates had hidden rate factors to increase cost of project without informing the Government.” In another instance, Halliburton “tried to inflate cost estimate by $26M.” In a third example, Halliburton claimed costs for laying concrete pads and footings that the Iraqi Oil Ministry had “already put in place.”
• Exorbitant Costs: Halliburton was “accruing exorbitant indirect costs at a rapid rate.” Government officials concluded that Halliburton’s “lack of cost containment and funds management is the single biggest detriment to this program.” They found a “lack of cost control … in Houston, Kuwait, and Iraq.” In a partial review of the RIO 2 contract, DCAA auditors challenged $45 million in costs as unreasonable or unsupported.
• Inadequate Cost Reporting: Halliburton “universally failed to provide adequate cost information,” had “profound systemic problems,” provided “substandard” cost reports that did “not meet minimum standards,” and submitted reports that had been “vetted of any information that would allow tracking of details.” Halliburton produced “unacceptable unchecked cost reports.”
• Schedule Delays: Halliburton’s work under RIO 2 was continually plagued by delays. Halliburton had a “50% late completion” rate for RIO 2 projects. Evaluations noted “untimely work” and “schedule slippage.”
• Refusal to Cooperate: Evaluations described Halliburton as “obstructive” with oversight officials. Despite the billions in taxpayer funds Halliburton has been paid, the company’s “leadership demonstrated minimal cooperative attitude resolving problems.”

View the full report

Local Military Contractor asks for Tax Abatement as Sales Rise

According to the Grand Rapids Press, Borisch Manufacturing, a local military (“defense”) contractor, is seeking a tax abatement from the Kentwood City Commission for a recent expansion. The expansion, which will cost $3.4 million, will include $750,000 on property improvements and add $2.6 million in new machinery and equipment to the company’s facilities. Borisch has been a steady recipient of military contracts since the start of the “war on terror” and has not only produced components for weapons systems used in Iraq, but markets its work as an inherent part of “patriotism” and ties their work to Christianity with founder John Borisch describing the company as a model Christian business and citing Psalm 115.1 under its company logo.

Borisch is asking for the tax abatements despite previous abatements from the city and increased sales. Sales for 2006 are expected to increase from $35 million in 2005 to $45 million and then grow again in 2007 to $50 million. Kentwood residents are encouraged to attend the public hearing on Borisch’s request for a tax abatement. The hearing will take place at the Kentwood City Commission meeting at 7:30pm on April 4 at Kentwood’s City Hall (4900 Breton Ave SE). Others may contact Kentwood’s City Commission although they will likely not be very receptive to concerns coming from non-residents.

$2,614,448 in Military Contracts Awarded to Grand Rapids Companies during February

Last month, $2,614,448 in military contracts were awarded to companies in the Grand Rapids, Michigan area. While the amount was not particularly large as far as military contracts are concerned, it does highlight the fact that the local companies and companies with manufacturing facilities continue to profit from the occupation of Iraq as the war nears the three-year point. Companies receiving contracts in February include:

• Borisch Manufacturing – Two contracts for electrical equipment totaling $269,814.

• L-3 Communications Avionics – Two contracts for aircraft components totaling $834,164.

• Eaton Aerospace – Three contracts for aircraft components totaling $284,698.

• Evans Tempcon – One contract for air conditioning manufacturing totaling $825,132.

• Smiths Aerospace – One contract for the repair of aircraft components for the Navy totaling $330,640.

• Advantage Sign Supply – One contract for silk screen materials totaling $70,000.

Military contracts awarded to local companies are being tracked as part of Media Mouse’s Grand Rapids Military Contracts database with the intent that they will provide some focus to antiwar organizing.

Grand Rapids Military Contract Database Now Online

Today Media Mouse unveiled a new online database tracking military contracts awarded to local companies and companies based in the Grand Rapids area. The database is essentially an updated version of a report released by Media Mouse last year (Aiming to Please: A Look at Military Contracts Awarded to Grand Rapids Area Companies), revised to include data from 2005 and 2006.

The database, documenting contracts received by local companies since the start of the United States’ “war on terror,” contains details of more than $380 million in contracts awarded by the military to local companies. These contracts have been awarded for a variety of services from cleaning and construction projects to components for fighter jets, armored vehicles, and missile systems. Components manufactured in Grand Rapids have been used in a variety of weapons systems including the AV-8B, the F-15, the F-16, the F-18, the M1A1 tank, the Stryker, and others, many of which have been used in the invasion and occupation of Iraq, thereby providing a clear link between local companies and the war. Moreover, the database also tracks tax breaks awarded to the companies, demonstrating the ways in which corporate welfare is frequently used to support the military-industrial complex and to provide the weapons needed to wage wars.

Since the United States began its attack on Afghanistan, the local corporate media has occasionally reported on local companies’ contributions to the war effort, although such reporting has been done so in a congratulatory manner that praises West Michigan’s contribution. The media has even gone so far as to describe contracts awarded to local companies as “collateral benefits,” making light of the “collateral damage” term used by the military to describe civilian casualties. Such coverage kicked off in 2002, when the Grand Rapids Press praised Eaton Aerospace for its contributions to the C-17 cargo plane that was being used to drop aid packets in Afghanistan and ignored the fact that the aid packets looked nearly identical to the yellow BLU-97/B cluster bomblets also being dropped . The Grand Rapids Press has profiled the head of Borisch Manufacturing and provided space for him to promote his assertions that his company is “supporting the troops” while ignoring the fact that weapons components made by Borisch are necessary for the ongoing occupation of Iraq and likely have contributed to civilian suffering in that country while allowing Borisch to tout his Christianity. Additionally, media coverage has frequently announced new contracts as they are awarded and has provided little information about the ways in which the weapon systems are used, as is the case when the media reports on contracts awarded to Smiths Aerospace.

The task of providing information about these contracts is undoubtedly important in light of the corporate media’s lack of coverage, but more important is the prospect that such information could be used to facilitate antiwar organizing in Grand Rapids. Antiwar organizing is frequently plagued by the difficulty in drawing links between what the United States is doing abroad and what is happening in Grand Rapids, and while activists have made attempts to draw connections in literature distributed at protests, such connections have rarely been used as the crux of an antiwar campaign. While there are indications this may change with the recent start of a campaign to pass a Grand Rapids City Commission resolution calling for the end to the occupation of Iraq in relation to the $132 million of Grand Rapids taxpayer money to fund the war in Iraq and the city’s ongoing budget difficulties, such connections have been made infrequently. Instead, activists have largely organized protests that have no direct connection to the government or institutions responsible for the war (see the anniversary protests of 2004 and 2005 for examples) or are held in response to visits by government representatives such as President George W. Bush or L. Paul Bremer. By focusing on companies manufacturing weapons, activists could target a direct link to the war and pursue the type of sustained and strategic organizing against the war that is desperately needed both on a local and national level.

The information contained within the military contracts database provides a number of organizing opportunities—activists could consider the prospect of civil disobedience at a contractor to physically stop contributions to the war, a campaign could be undertaken to prevent new tax breaks from being awarded to companies making components used in the Iraq war, a media campaign could be launched to educate the press and the public about how these weapons are used in Iraq, or public protests at contractors’ factories could be held.