On September 10,
Donald Rumsfeld gave a speech to kick off
DOD Acquisition and Logistics
Excellence Week Kickoff—Bureaucracy to Battlefield. It
was in this speech that Rumsfeld said that by some estimates
"we cannot track $2.3 trillion in transactions".
The assumption made by most people in the 9-11 Truth
community that what he meant was that $2.3 trillion dollars
came up missing from the DOD accounts. And
they pointed at Dov Zakheim as the suspect because he was
Undersecretary of Defense and Comptroller of the
Pentagon. That's a reasonable suspicion minus a few
critical insights into the process of selling information
technology and computer systems. It's standard
procedure in the IT Consulting business when justifying
costs for new systems to pump up the negatives as reasons
why the new system(s) are needed. The bigger the new
system(s), the higher the dollar value of the negatives for
not doing it. The fact that Rumsfeld used $2.3
trillion as the negative indicates how big the contract
values are for the privatization of the military that he was
Key points from Rumsfeld's remarks.
Rep. John Mica (R-FL)
Mica was with Donald Rumsfeld
for a breakfast meeting at the Pentagon on September 11,
2001. Purpose of the meeting: "to make certain we were
prepared for something we might not expect". Audio clip
from the August 1, 2007 House Oversight Committee on Pat
The adversary's closer to home. It's the
Not the people, but the
processes. Not the civilians, but the systems. Not
the men and women in uniform, but the uniformity
of thought and action that we too often impose on
Our challenge is to transform not just the way
we deter and defend, but the way we conduct our
daily business. Let's make no mistake: The
modernization of the Department of Defense is a
matter of some urgency. In fact, it could be said
that it's a matter of life and death, ultimately,
We must develop and build weapons to deter
those new threats. We must rebuild our
infrastructure, which is in a very serious state
of disrepair. And we must assure that the noble
cause of military service remains the high calling
that will attract the very best.
All this costs money. It costs more than we
have. It demands agility -- more than today's
And that means we must
recognize another transformation: the revolution
in management, technology and business practices.
Successful modern businesses are leaner and less
hierarchical than ever before. They reward
innovation and they share information. They have
to be nimble in the face of rapid change or they
die. Business enterprises die if they fail to
adapt, and the fact that they can fail and die is
what provides the incentive to survive. But
governments can't die, so we need to find other
incentives for bureaucracy to adapt and improve.
The technology revolution has transformed
organizations across the private sector, but not
ours, not fully, not yet. We are, as they say,
tangled in our anchor chain.
Our financial systems
are decades old. According to some estimates, we
cannot track $2.3 trillion in transactions. We
cannot share information from floor to floor in
this building because it's stored on dozens of
technological systems that are inaccessible or
To that end, we're announcing today a series of
steps the Department of Defense will take to shift
our focus and our resources from bureaucracy to
battlefield, from tail to tooth.
But we have the ability—and, therefore, the
responsibility—to reduce waste and improve
operational efficiency on our own. Already we have
made some progress. We've eliminated some 31 of
the 72 acquisition-related advisory boards. We now
budget based on realistic estimates. We're
improving the acquisition process.
$400 million in public-private partnerships for
military housing. Many utility services to
military installations will be privatized.
when the Iraq war started, the DOD sold the
military housing on Long Island. As I
recall, the families were going to get a housing
Here is 2007 budget for
construction of military housing.
Where is all the money going? This is not
DOD mis-allocation. This is the Congress -
closing bases, selling off military housing and
then paying to rebuild - with public-private
We're tightening the requirements for other
government agencies to reimburse us for detailees,
and we're reviewing to see whether we should
suspend assignments where detailees are not fully
- We have committed $100 million for financial
modernization, and we're establishing a Defense
Business Board to tap outside expertise as we move
to improve the department's business practices.
In order to make decisions more quickly, we
must slash duplication and encourage cooperation.
Currently the Departments of the Army, the Air
Force and the Navy operate separate but parallel
staffs for their civilian and uniformed chiefs.
These staffs largely work the same issues and
perform the same functions. Secretaries White and
Roach will soon announce plans for realigning the
Departments to support information sharing, speed
decision-making, integrate Reserve and Guard
headquarters into Department headquarters.
Secretary England is engaging a broad agenda of
change in the Department of Navy as well.
[Consolidation of power. This is why we have
an Admiral in charge of ground troops in Iraq].
To transform the Department, we must look
outside this building as well. Consequently, the
Senior Executive Council
will scour the Department
for functions that could be performed better and
more cheaply through commercial outsourcing. Here,
too, we must ask tough questions. Here are a few:
Why is DOD one of the last organizations around
that still cuts its own checks? When an entire
industry exists to run warehouses efficiently, why
do we own and operate so many of our own? At bases
around the world, why do we pick up our own
garbage and mop our own floors, rather than
contracting services out, as many businesses do?
And surely we can outsource more computer systems
Maybe we need agencies for some of those
functions. Indeed, I know we do. Perhaps a
public-private partnership would make sense for
others, and I don't doubt at least a few could be
outsized -- outsourced altogether.
[Great idea huh?
Replace a $20,000 soldier with a $60,000
contractor. Not to mention the national
security implications of outsourcing military
administrative jobs. Last year, the Pentagon
had a proposal to hire foreign workers for work
requiring security clearances because of the
"shortage of American workers". They posted
it for public comment - and they probably got more
comments than they bargained for. My comment
was to the effect, "if I was on contract to a
foreign government and came into contact with
state secrets, I'd be happy and proud to pass the
information along to my government. ]
Guard Deep water Project
Note: Video says
contractor was Lockheed for Deepwater - here's
& their partners.... the Communist Chinese -
Like the private sector's best-in-class
companies, DOD should aim for excellence in
functions that are either directly related to
warfighting or must be performed by the
But in all other cases, we should seek
suppliers who can provide these non-core
activities efficiently and effectively. The Senior
Executive Council will begin a review of the
Defense Finance and Accounting Service, the
Defense Logistics Agency and Defense Information
[This is TQM - Total Qrap Management.
It is the management philosophy that
Rand Corporation constructed. The
objective is to get corporations to
outsource as many of their "non-core"
functions as possible. Mattel is a
good example of TQM in action.
They used to be a toy manufacturer.
Now they are simply a "brand manager".
They've outsourced everything except the
name "Mattel". And that's why they
are importing lead coated toys for tots.
They don't control anything. They
just import cheap Chinese Qrap.
In the military, a slick marketing
person can make a case that only the
lowest level soldier carrying a gun is a
"core function" of the military.
We've seen how well that works in Iraq.
Soldiers were ill-equipped, poorly
supplied, they got bad water and
unhealthy food. But.... the
Contractors are making a fortune.
And that's really what's important
Second, this effort is structurally different
from any that preceded it, I suspect.
with the personal endorsement, in fact the
mandate, of the President of the United States.
President Bush recently released a management
agenda that says that performance, not promises,
will count. He is personally engaged and aware of
the effort that all of you are engaged in. The
battle against a stifling bureaucracy is also a
personal priority for me and for the Service
Secretaries, one that will, through the Senior
Executive Council, receive the sustained attention
at the highest levels of this Department. We have
brought people on board who have driven similar
change in the private sector. We intend to do so
here. We will report publicly on our progress. The
old adage that you get what you inspect, not what
you expect, or put differently, that what you
measure improves, is true. It is powerful, and we
will be measuring.
Does any of this
remove Dov Zakheim of suspicion? Certainly
not. In fact, he is in the thick of it.
Dov Zakheim was one
of the participants in the Rand Report,
"2001 Transition Report" along with Paul
Wolfowitz, Ashton Carter,
Lake, Zalmay Khalilzad and others.
Following his stint
at the DOD, he became Vice President of Booz Allen
Dov S. Zakheim is a Vice President of
Booz Allen Hamilton, a global strategy
and technology consulting firm, where he
is a leader in the firm’s global defense
business, working with U.S. Combatant
Commanders and allied and coalition
ministries of defense worldwide.
2001 to April 2004 he served as the
Under Secretary of Defense (Comptroller)
and Chief Financial Officer for the
Department of Defense, acting as the
Secretary of Defense’s principal advisor
on financial and budgetary matters,
developing and managing
world’s largest budgets,
overseeing all aspects of the
Department’s accounting and auditing
systems, and negotiating five major
defense agreements with US allies and
partners. From 2002-2004 Dr. Zakheim was
DOD’s coordinator of civilian programs
in Afghanistan. He also helped organize
both the June 2003 UN donors’ conference
on Iraq reconstruction and the October
2003 Madrid Donors’ Conference.
1987 to 2001 he was both corporate vice
president of System Planning
Corporation, a technology, analysis firm
based in Arlington, VA, and chief
executive officer of SPC International
Corp., a subsidiary specializing in
political, military and economic
consulting. During the 2000 presidential
campaign, he served as a senior foreign
policy advisor to then-Governor Bush.
1985 until March 1987, Dr. Zakheim was
Deputy Under Secretary of Defense for
Planning and Resources in the Office of
the Under Secretary of Defense (Policy),
playing an active role in the
Department's system acquisition,
strategic planning, programming and
budget processes. Dr. Zakheim
held several other DOD posts from 1981
to 1985. Earlier, he was a principal
analyst in the National Security and
International Affairs Division of the
Congressional Budget Office.
Zakheim has served on a number of
government, corporate, non-profit and
charitable boards. His government
service includes two terms on the United
States Commission for the Preservation
of America's Heritage Abroad (1991-93);
the Task Force on Defense Reform (1997);
the first Board of Visitors of the
Department of Defense Overseas Regional
Schools (1998); and the Defense Science
Board task force on "The Impact of DOD
Acquisition Policies on the Health of
the Defense Industry" (2000).
He is a member of the
Defense Business Board,
which he helped establish, the Chief of
Naval Operations Executive Panel and the
Council on Foreign Relations.
graduate of Columbia University with a
B.A., summa cum laude, in
Dr. Zakheim also studied at the London
School of Economics. He earned
his doctorate in economics and politics
at St. Antony's College, University of
Oxford, where he was a National Science
Foundation Graduate Fellow, a Columbia
College Kellett Fellow, and a St.
Antony’s College Research Fellow. He has
been an adjunct Senior Fellow of the
Council on Foreign Relations, an adjunct
Scholar of the Heritage Foundation and a
Senior Associate of the Center for
Strategic and International Studies. Dr.
Zakheim has been an adjunct professor at
the National War College, Yeshiva
University, Columbia University and
Trinity College, Hartford, Conn., where
he was a Presidential Scholar.