Cronyism at the Defense Department Puts National Security at Risk

BY BOB BARR

The famous adage admonishing us not to “put all your eggs in one basket,” may seem childish and outdated to 21st-century brainiacs at the Department of Defense, but it is in fact as relevant today as when it was authored anonymously in the mid-17th Century. And yet, such a mistake is precisely what Defense Secretary James Mattis appears hell-bent to make, as he moves to award a sole-source, multi-year, and multi-billion-dollar contract to Amazon for the Department’s cloud computing needs for at least the next decade.

In the view of many knowledgeable observers, the move appears predicated on an overly cozy, some might say “crony,” relationship between Defense Department leaders and one of the world’s richest men, Amazon’s Jeff Bezos.

Amazon has the largest share of the entire cloud computing infrastructure market – more than 44 percent, as noted recently by Bloomberg – and already enjoys a multi-hundred million dollar contract with the CIA for that agency’s cloud computing. Whether the “fix” is in for Amazon to now secure the lucrative, 10-year Defense Department-wide contract remains to be seen; but the prospect that it will be so awarded is raising bright red flags on Capitol Hill and within the intelligence community.

A prime reason for such concern is the price Amazon had to pay just last year in order to ink a deal with China for cloud computing in that communist-run country. Amazon Web Services (AWS), the same Amazon entity vying for our country’s Department of Defense cloud computing contract, was forced to hand over to a Chinese company with close links to that country’s government (Beijing Sinnet Technology) the keys to the Seattle-based company’s relevant cloud computing technology. As noted by the Wall Street Journal last November when word of that deal became known, the move by Amazon to transfer a portion of its cloud computing technology to a Chinese company, fits with Beijing’s “desire to control cyberspace.” At a minimum, it raises a red flag regarding the overall security of Amazon’s cloud computing technology.

While the Pentagon’s planned IT system overhaul project has been given the clever acronym “JEDI” (short for the Joint Enterprise Defense Infrastructure project), there is little humor to be found in the manner by which Amazon has worked its way into the highest levels of decision-making throughout America’s defense and foreign intelligence sectors. Bezos and his company have succeeded in this strategy despite being publicly pilloried by President Trump for the company’s cozy relationship with the Obama Administration and liberal Democrats on Capitol Hill, and for its ability to evade tax liabilities. But, with one of the largest and most costly lobbying efforts in the nation’s capital, Amazon appears at this juncture to have weathered Trump’s criticism.

Close relationships between individuals of great wealth and government leaders are nothing new, of course. Jacob Fugger, a 16th-century German financier, labeled “The Richest Man Who Ever Lived” by Greg Steinmetz in his 2015 book by the same name, bankrolled and essentially controlled the Austrian Habsburg dynasty for years, because of his vast wealth and his willingness to use it for political influence. Fugger, perhaps the first true “crony capitalist” in the modern sense, appears to be bested now by Bezos; who, by some calculations is the new “richest man who ever lived.”

The problem in this current saga is not so much Amazon or Amazon Web Services per se. The company clearly is a leader in developing and maintaining cloud computing systems. But it is by no means the only company able to provide such services. Microsoft, Google, Oracle, and IBM all provide hard technology and services that meet the needs of the Defense Department, the CIA, and other components of our national defense community.

These companies claim, quite accurately, that giving a single company (Amazon) what would amount to a long-term monopoly on cloud computing technology for the entire U.S. defense establishment, diminishes, rather than enhances, the overall security of that system. They, along with other voices on Capitol Hill and within the Trump Administration, argue strongly for a multi-source contract as a hedge against relying on a single purveyor; especially when that company already is in bed with one of America’s major global adversaries.

The stakes in this technology battle are massive. According to Bloomberg, for the Department of Defense alone, there are some four million computer devices and 3.4 million users, along with 1,700 data centers and some 500 different cloud initiatives that would be subject to the JEDI program’s overhaul of the Pentagon’s cloud computing system.

The real problem here goes beyond the money alone, and even beyond questions of cronyism. The path down which Mattis and his supporters appear to be travelling would present a clear and present danger to the security of America’s most vital national defense data. There is no room for error; and the door to transparency and robust competition must be opened far wider than at present.

Editor’s Note: This column originally appeared in The Daily Caller.


Self-Educated American Contributing Editor, Bob Barr, represented Georgia’s 7th district in the U.S. House of Representatives from 1995 -2003 and as U.S. Attorney for the Northern District of Georgia from 1986-1990.