Perception Is Reality, or Is It? A Case Study of Four Department of Defense (DoD) Procurement Scandals Does Media Coverage Lead to Procurement Reform? By Airon Ann Mothershed B.S., May 1998, University of Idaho J.D., May 2001, University of Idaho College of Law A Thesis submitted to The Faculty of The George Washington University Law School in partial satisfaction of the requirements for the degree of Master of Laws August 31, 2011 Thesis directed by Christopher R. Yukins Professor of Government Contracts Law and Co-Director, Government Procurement Law Program Acknowledgements The author wishes to thank Professors Christopher R. Yukins and Karen D. Thornton for their insight, guidance, and encouragement on this paper. ii Disclaimer Major Airon A. Mothershed serves in the U.S Air Force Judge Advocate General„s Corps. This paper was submitted in partial satisfaction of the requirements for the degree of Master of Laws in Government Procurement at The George Washington University Law School. The views expressed in this paper are those of the author and do not reflect the official policy or position of the United States Air Force, Department of Defense, or the U.S. Government. iii Abstract Perception Is Reality, or Is It? A Case Study of Four Department of Defense (DoD) Procurement Scandals Does Media Coverage Lead to Procurement Reform? Over the past thirty years, American taxpayers have seen multiple Department of Defense (DoD) procurement scandals brought to light. Of these historic scandals, some of the most egregious examples include: the spare parts scandal that emerged in the early to mid-1980s, which introduced the public to the $435 hammer and $600 toilet seat; the Operation Illwind scandal, which exposed a network of corruption in the DoD procurement system; and the Darleen Druyun scandal, which led to a decade-long saga surrounding the replacement of the refueling tanker aircraft. Based upon lessons learned from these past mistakes, Congress and the DoD have reformed the federal procurement system several times in numerous ways. Nevertheless, the current federal procurement system is not perfect. As such, new DoD procurement scandals arise from time to time, and with each new occurrence, Government and DoD officials must again review the process to determine if new reforms are necessary. One recent procurement scandal has again drawn attention to the procurement process. Identified as the “Contracting With the Enemy” scandal in this thesis, this crisis was revealed in Fall 2009 when a news journalist reported the Taliban and other enemies of the U.S. were being indirectly funded via U.S. taxpayers‟ dollars through U.S. contracting activities in Afghanistan. iv Throughout the history of these DoD procurement scandals, the media has played an important role. All of the historic scandals met the criteria of newsworthy stories. They were current, negative, and related to the Government‟s spending an exorbitant amount of taxpayers‟ money. These elements provided continuous fodder and helped journalists maintain public interest in the news stories surrounding the scandals throughout the life of each scandal. As news journalists reported on each scandal, they emphasized the most salacious, human-interest factors of each scandal – these included “greedy” contractors and defense consultants, corrupt high-level procurement officials, and crusading public servants. The current scandal, thus far, seems to be presenting similar elements. The purpose of this paper is to analyze and determine the correlation between media coverage and procurement reform to determine if such coverage promotes reform. In this endeavor, this thesis will explore the facts, circumstances, and related media coverage surrounding the three historic and one current DoD procurement scandals mentioned above. This paper will briefly discuss the definition of a procurement scandal and the criteria news media use to determine whether to publicize scandals. It will then present three methodologies for analyzing the correlation between media coverage, scandals, and reform. The facts of the three historic scandals will be applied and analyzed to the methodologies to ascertain the correlation between the media coverage and subsequent reform that occurred in those cases. Then, the results and analyses derived from the historic scandals will be applied to the current DoD procurement scandal and used as a tool to predict whether or not reform will occur in the case of the Contracting With the Enemy scandal. v Table of Contents I. INTRODUCTION .......................................................................................................... 1 A. What is a Scandal? .................................................................................................... 2 B. Scandals As Newsworthy Stories .............................................................................. 4 II. A CASE HISTORY OF THE $435 HAMMER AND $600 TOILET SEAT SCANDALS AND RELATED MEDIA COVERAGE ...................................................... 5 A. How it Began ............................................................................................................. 6 B. The $435 Hammer Scandal ....................................................................................... 7 1. Background Facts ................................................................................................... 7 2. Media Coverage and the Development of the Hammer Scandal ............................ 8 C. The $600 Toilet Seat Scandal .................................................................................. 12 1. Press Coverage of the $600 Toilet Scandal and Ongoing Hammer Scandal ........ 13 D. Outcome and Reform Resulting From the Spare Parts Scandals ............................ 15 III. A CASE HISTORY OF OPERATION ILLWIND AND ITS RELATED MEDIA COVERAGE ..................................................................................................................... 20 A. How it Began ........................................................................................................... 20 B. Media Coverage and the Development of the Operation Illwind Scandal .............. 24 C. Outcome and Reform Resulting from the Operation Illwind Scandal .................... 46 IV. A CASE HISTORY OF THE DARLEEN DRUYUN SCANDAL AND ITS RELATED MEDIA COVERAGE ................................................................................... 52 A. How it Began ........................................................................................................... 54 B. The Darleen Druyun Scandal .................................................................................. 59 1. Background Facts ................................................................................................. 59 2. Media Coverage and the Development of the Darleen Druyun Scandal .............. 61 C. Outcome and Reform Resulting from the Darleen Druyun Scandal ....................... 81 V. A CURRENT STUDY OF THE CONTRACTING WITH THE ENEMY SCANDAL AND RELATED MEDIA COVERAGE .......................................................................... 89 A. How it Began ........................................................................................................... 89 B. The Contracting With the Enemy Scandal .............................................................. 91 1. Background Facts ................................................................................................. 91 vi 2. Media Coverage and the Development of the Contracting With the Enemy Scandal....................................................................................................................... 92 C. Reform Thus Far Resulting From the Contracting With the Enemy Scandal ....... 108 VI. METHODOLOGIES AND ANALYSIS REGARDING THE RELATIONSHIP BETWEEN MEDIA COVERAGE, SCANDALS, AND REFORM ............................. 111 A. Methodology 1: Drohan‟s Seven Stages of Scandal ............................................ 112 1. Findings and Analysis: Drohan‟s Stages of Scandal as Applied to the Hammer and Toilet Seat Scandals .......................................................................................... 115 2. Findings and Analysis: Drohan‟s Stages of Scandal as Applied to the Operation Illwind Scandal ........................................................................................................ 120 3. Findings and Analysis: Drohan‟s Stages of Scandal as Applied to the Darleen Druyun Scandal ....................................................................................................... 125 B. Methodology 2: Sherman‟s Study of Correlation Between Scandal and Reform ......................................................................................................................... 137 1. Findings and Analysis: Sherman‟s Theory as Applied to the Hammer and Toilet Seat Scandals ........................................................................................................... 138 2. Findings and Analysis: Sherman‟s Theory as Applied to the Operation Illwind Scandal..................................................................................................................... 140 3. Findings and Analysis: Sherman‟s Theory as Applied to the Darleen Druyun Scandal..................................................................................................................... 142 C. Methodology 3: The News Framing Analysis Theory ........................................