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Minority report.

Not long ago [see "Minority Report," June 16] I asked what the Navy and Justice Departments were proposing to do about General Dynamics. Adm. Hyman Rickover had furnished strong evidence that the Electric Boat division of that company was awash with graft. And P. Takis Veliotis, former executive vice president of General Dynamics, was offering to make public his extensive knowledge of high-level fraud and embezzlement. Justice Department officials were more than usually bashful about Veliotis, going so far as to tell Congressional committees that they did not believe he had the tape recordings or other evidence that he claimed, and making only the most languid efforts to contact him.

But right triumphs in the end. To the embarrassment of the Justice Department, Veliotis has given his tapes, which turn out to be real enough, to the press and to the F.B.I. And John F. Lehman Jr., Secretary of the Navey, has launched a fearless, no-holds-barred investigation of--Adm. Hyman Rickover. So it goes in Ronald Reagan's Washington. Messengers, if they bring bad news, are ingnored or slandered or shot.

One need not be especially sentimental about Admiral Rickover. Anyone who is proud to be called Father of the Nuclear Navy can look after himself as far as I am concerned. But the old boy has been relatively brave and honest in his public statments, and has been demanding an inquiry into General Dynamics and its depredations since 1978. The Veliotis tapes show how right he was. They record David S. Lewis, chairman of the company, saying in October 1981 that he wanted to withold internal estimates showing a $100 million cost overrun on nuclear submarines. The auditors, the Navy and the public were not to know, he said. This was after the American taxpayer had shelled out $639 million in added compensation to G.D., the largest such settlement in Navy history. Charity on this scale has enabled General Dynamics to submit low bids, win contracts, milk the public and then, with Navy Department collusion, blame the resulting scandal on the whistle blowers.

The last bit of this maneuver is the most complicated, and Secretary Lehman has yet to master it. But not for want of trying. Lehman is evidently the sort of person who goes home after a trying day and roughs up his teddy bear. Faced with the gigantic proportions of the General Dynamics ripoff, he has come out bravely and denounced Admiral Rickover for accepting trinkets. He has even, in a letter to Representative John Dingell dated November 21, made the Rickover case the sole issue of concern between his department and the Congress. Dingell, who chairs the Oversight Subcommittee of the Committee on Energy and Commerce, replied that Lehman should direct his attention to:

The contents of the tape, the alleged bribery of a top official and member of the Board of directors of the Corporation, the role of another member of the Board of Directors in a bribery scheme, allegations of other potential bribery incidents, your own Naval Investigative Service investigation of possible fraudulent charges against the government involved in the misuse of corporate aircraft at General Dynamics, the Department of Justice grand jury investigation and the SEC investigation. Dingell adds: I am curious about the Navy's apparent lack of interest in contacting Mr. Veliotis or in contacting the Subcommittee to review over forty boxes of internal General Dynamics documents relating to the management of the submarine program at Electric Boat that should be of intense interest to the Navy. Apparently, the Navy is more interested in Admiral Rickover than in determining whether General Dynamics is fit to be a contractor of the Navy.... If a small contractor found itself in a fraction of this kind of trouble, I would guarantee you that it would never see another government contract.

That last sentence is certainly accurate. Recently, a minor contractor in Texas was debarred from government business for three years, and stuck in front of a grand jury, for giving a Federal employee a $200 TV set and a subscription to Playboy. You have to offer really serious bribes before the Navy tugs on the kid gloves.

That Rickover took gratuities is not in doubt. He got a $695 pair of diamond earrings and a $430 jade pendant (presumably not for his own adornment) in 1977 alone. Ship models, tiepins and, no doubt, cuff links were rained on him during his campaign for the nuclear submarine fleet, and many of these little numbers came from General Dynamics. Having denounced Rickover for accepting these trifles, which may have been worth at least $60,000, Lehman took the time to criticize Dingell for asking that some cheesy G.D. contracts be canceled. His tone, as he switched from smearing Rickover to standing up for a defenseless corporation, took on a new righteousness: "This kind of cry for blood ill-befits institutions of our government that are supposed to defend civil liberties and civil rights rather than demanding drumhead justice."

Blood? Civil liberties? Civil rights? What is this? Anyone would think that General Dynamics was risking its own money. Only five days before this outburst, Lehman appointed a board to examine submarine contract violations and declared, "I will make the final decision regarding remedies, if warranted, based on those findings." By denouncing, in advance of the "findings," the only "remedies" that could work, he has saved his board a lot of trouble and given us all an insight into the workings of his department.

This is all of a piece with the Reagan style. Raymond Donovan was described by the President as being chased by a press "lynch mob" when actually he was treated with unusual tenderness. Ed Meese is described as "vindicated" when all he has done is escape criminal indictment. Food stamps are counted, and the deficity is not. Government and the corporations remain more than ever on the backs of the American people, but heroic measures are taken to change the subject. This is Navy Department bravery in the grand tradition of Manila Bay, the Maine and the Tonkin Gulf.
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Title Annotation:why the Justice Department was reluctant to investigate General Dynamics
Author:Hitchens, Christopher
Publication:The Nation
Article Type:column
Date:Dec 15, 1984
Previous Article:Inequity forever.
Next Article:Sovieticus.

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