Whitewash

Henry Durham is an intense, patriotic southerner who blushes when he quotes someone else’s swear word. He likes camping, fishing and football and John Wayne movies “because they’re rough and tough and not, you know, dirty.” Drive out to his split level home outside Atlanta in bustling Marietta and you'll find an American flag decal and a National Rifle Association sticker on the back window of his jeep.

Henry Durham used to work for the world’s largest private defense contractor-the Lockheed Aircraft Corporation. Today he thinks Senator William Proxmire hasn’t done all he could to punish Lockheed for its $2,000,000,000 cost overrun on the C-5A airplane, and he calls the U.S. Comptroller General “a gutless bureaucrat” for issuing a report that "whitewashes” the mismanagement and collusion behind the overrun.

The original $3.7 billion contract which Lockheed won [“everybody knew Boeing’s design was better,” says Durham, “but Lockheed had Senator Richard Russell"] called for 120 planes designed for moving troops and over-sized cargo quickly to brush-fire wars. At a cost of $5.2 billion, the Air Force is getting eighty-one planes which have one-fourth the original design’s life expectancy, won't be able to use rough runways as called far by their counter-insurgency mission, and are given to losing wheels and engines and wings. The first plane off the gigantic Marietta assembly line was honored in ceremonies by President Johnson and Governor Maddox, but, according to Durham, the plane had so many fake parts, some just made of wood and paper, that it could not fly. It later blew up on the runway.

For most of his 19 years with Lockheed’s Marietta division, Henry Durham dutifully served the company. “I even neglected my family and tried to make it up the ladder, you know, to vice president. What was good for Lockheed was good for the world as far as I was concerned.” When Lockheed won the C-5A contract, its employment, already the biggest growth factor in the area, mushroomed to 33,000. And in 1969, Durham was promoted to manager of production control activities on the flight line. From this position, Durham learned how waste brought a giant company higher profits. 

As a conscientious employee, Durham told his superiors about missing parts on planes and overstocking of expensive parts; but his superiors ignored him, told him to shut up, and finally abolished his job. As a conscientious American, he wrote 86 Congressmen offering to come to Washington to tell them about Lockheed’s shoddy performance and criminal use of taxpayers’ money; no one was interested, even though Senate debate over Lockheed’s $250,000,000 loan guarantee was roaring.

Durham finally got Morton Mintz of the Washington Post interested in his well documented charges. When the story broke, Durham got more publicity than he bargained for. He started getting threatening telephone calls from his Marietta neighbors; signs appeared on Lockheed bulletin boards saying “Kill Durham”; the family’s church even gave them the cold shoulder. “You can say something against the Lord and people would forgive you,” says wife Nan Durham, “but not if you say anything against Lockheed.” A dedicated Christian and Sunday School teacher, Nan sought help from Billy Graham-but he didn’t want to get involved either.

The publicity did bring Durham an invitation to appear before Senator Proxmire’s Joint Economic Committee—but the hearing date was postponed until after the Senate passed the $250 million loan by one vote. Finally, on September 29, 1971, Henry Durham went to tell his government a horror story in big time thievery. Proxmire asked the General Accounting Office to study the charges Durham made; five months later the GAO staff report confirmed nearly every charge.

But the staff report was squelched by GAO boss, Elmer B. Staats, the Comptroller General of the U.S. In its place, Staats presented an official GAO report to a new Proxmire committee hearing on December 18, .1972. Staats said some of Durham’s charges were inaccurate, others were corroborated by the evidence, but he suggested many of these were isolated cases or remedied by Lockheed’s own actions. When Durham got his chance to testify, he blasted the Staats report as a “whitewash” and termed Proxmire’s acceptance of it “a cop-out!”

“People don’t realize how rotten things are on the inside of some of these giant companies or how

the federal government supports them,” says Durham. “We’ve got to get the truth about this story out and get people moving.” Here, then, is Henry Durham’s story.

 

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Shortly after I became general department manager over production control on the flight line, in July and August, 1969, I became aware of serious deficiencies in C-5A aircraft coming out of the assembly area to the flight area. When planes arrive at the flight line from the assembly line, they’re supposed to be virtually complete except for a few adjustments and normal radar and electronic equipment installation, but I noticed these serious deficiencies. These weren’t just minor deficiencies; these aircraft were missing thousands and thousands of parts when the Lockheed records showed the aircraft to be virtually complete.

At first I thought it was an error in the papers. Then I initiated an audit. I found it was true. I was amazed. But I still thought there was some kind of mistake going on.

Later I figured out that the company was consciously indicating through the inspection records that it had done the work so it could receive credit and payment from the Air Force when actually it wasn’t on schedule and hadn't done the work.

Somebody in one of the production sections would fall behind, but they’d move the unit—whole sections of the plane—down the line anyway. They’d close the paper work to show that the parts were installed, that everything was on schedule.

But, of course, when the people in the next area go up to install a tube or something there’s no supporting bracket there. So what do they do? They throw the part in the corner or on the floor of the plane. Multiply that by the hundreds and thousands and you get a picture of what the problem was. These are everything from tiny parts to something as big as a door. A wide range of parts. Relatively inexpensive parts to very expensive parts. Our audit showed that over 67 percent of the parts issued were missing, the paper work had actually been closed out, and there was no evidence of any installation at all.

To get all the open items filled on the last stage is very expensive. Closing the missing parts necessitated overtime, paying premium prices for parts, having them shipped air express, people on the phone frantically calling vendors to bring stuff in.

The paper work would be in such confusion that I remember one case where we had 10,000 parts brought in for one airplane on the flight line, and eventually we didn't need 4,000. But these weren’t used in the next airplane either, since they were recorded as ordered for a previous ship. So more new parts were ordered for the next ship.

We’re talking about millions of dollars. Lockheed was continuously buying more parts than required. Parts would come in, but in a few days they would be lost. When the time came to build the assembly, the parts would be missing, so they’d go buy some more. So, they were doing what I call the “blind purchase.’’ They would order stuff without even looking to see if they could find the materials somewhere in the plant.

There was also a problem with what I would call chaotic engineering. Everything was push, push, push, from the time the C-5A program started. The schedule was just so fantastic. For example, while one man was designing a part of the airplane, another man at the next drawing board would be making changes in the first man’s design. 

You’d actually go buy materials and build the parts, only to have engineering changes coming out  within a few weeks, scrapping tne parts you just built as being no good. There were constant structural changes on the C-5A and millions of dollars worth of material wasted as a result.

I remember when the wing cracking problem first came up. There was a fantastic amount of activity around the plant. Somebody came up with a design change to repair the wing. It called for something like 250 new parts, as I recall, for each ship. So we negotiated with the California plant (Lockheed-California) to build those parts required for the 30 or so ships involved. Finally we got all the parts.

And then somebody else came along and said it would take something like 600 parts to repair the wings of each ship. So we went out on a big rush-rush basis. I remember it well. We were told to get it done, whatever cost it took. It required lots of overtime, premium prices, and meetings every morning with the suppliers.

A day or two after we finish I am saying, “Man, that was a good job, everybody did great.” Then I get a call and it says, “Guess what, we don’t need those parts after all.”

Apparently there were two factions in engineering, one at Marietta and one at California. It was decided that only the 200-plus parts were needed. So we had those thousands of extra parts, 600 parts for each of say 30 ships, as well as all that overtime and other special costs. That was typical of what went on.

When I told my immediate superior about the missing parts and false reporting for progress payments I was told to shut up and hide the reports. This was in October, 1969. You see, I had released one of the reports to a man in charge of the flight-line production area. I wanted him to correct the problem at his end. Well, the fact that a copy of that report could get out must have frightened them very much, because I got a call from my boss telling me to get that report back and get it fast, you know. The guy didn’t want to give it back. The next morning I got a call from his boss. He said, “Look, if you can’t do anything else, get a stamp and mark it ‘confidential material.’”

That was a typical reaction. The divisional level management people-people more or less on my own level-would stop me and look down their noses and ask me, “What the hell do you think you’re doing writing about missing parts; why don’t you be quiet; why don’t you mind your own business, etc.” But that really just made me more determined. I went to all levels of management. I wasn’t afraid of any of them, and I took it to their boss.

Finally I attempted to make an appointment with Mr. Fuhrman, president of Lockheed-Georgia. I called one day, and got the secretary, and left my name and number. Within a few minutes, my boss was on the phone wanting to know what in the hell I was doing trying to contact Fuhrman.

I was told I’d have to talk to W. P. Freeh first; he’s director of manufacturing. I agreed and was able to see him after about a week. But it was very unsatisfactory. He ignored a report I gave him when I first walked into his office; it had the data on it, and I practically had to force him to read it. He talked about everything else except what I wanted to talk about.

Finally I got the problem across to him, I thought, so I decided to wait a couple of weeks. But nothing happened. So I called Fuhrman late one afternoon in his office and caught him. We made an appointment. I met him and we talked about an hour and a half. I gave him very much the same material I presented in testimony, a lot of it, dealing with mismanagement, waste, throwing away of parts, and all the other things. He listened, but that’s about all. He never did anything about it that I know of. After that my job was abolished. I was pushed in a corner, ostracized. This was in April or May of 1971.

I sent a four page letter with substantiating documents to Mr. Daniel J. Haughton, chairman of the Lockheed Corporation. I received a short reply from Haughton promising to launch an investigation and advise me of the results. I am still waiting to hear from Mr. Haughton. 

Approximately two months after my lay-off, I received an unexpected call asking me to come back to work for Lockheed. I initially refused to return, but finally agreed to accept a position in Chattanooga, Tennessee, a hundred miles from Marietta. I accepted this position on the basis that Mr. Haughton would follow up on the investigation he promised.

Surely, I thought, Uncle Dan, the venerable Lockheed chief, the dear old white haired patriarch of the Lockheed family would do something to straighten out the mess. I later learned, to my dismay, that he was also deeply involved in the shenanigans. At the time, my decision was to go to Chattanooga while I waited to hear from Haughton. I didn’t realize that I was being sent to Siberia to be kept out of the way but still dangling on the string.

Unfortunately, conditions at the Chattanooga plant were as deplorable or worse than those at the mother plant. For instance, there were no inventory controls. The company was purchasing parts and materials from vendors at exorbitant prices when the same materials were available in Lockheed’s own stores at a fraction of the price.

I couldn’t stand it any longer. I hadn’t heard from Haughton or anyone else. I could no longer live with myself. So, motivated by a deep sense of moral indignation, I quit. Before I left, however, thw director of management for the company paid me a special visit. He apparently thought I might be planning to go outside Lockheed to publicize conditions in the company. He asked me, “Do you know what happened to A. E. Fitzgerald who went to Washington with some Lockheed problems?’’ When I said I did not, he said, “Well, I’ll just tell you: Fitzgerald is now chief shit house inspector for the civil service, and will never be able to get a good job as long as he lives.’’ He indicated that anybody who bucks Lockheed or the system is in for a rough time. He is right on that score for I have been blacklisted and have been unable to secure a meaningful management position anywhere.

I’m convinced that if some kind of protection from economic loss, physical reprisals and job loss were given to people who wanted to come forward out of industry or government, they would come, and you would see a lot of things cleaned up. But right now people are afraid. When you stay with a company for, say, nineteen years, you’re not trained in anything else; it’s hard to find another position. And there is literally fear of people in the community. A guy called me one day and offered to bring me--then he changed that to send me in the mail, anonymously-some material to take with me to Washington that was of vital importance. I said I’d be glad to have it.

A few days went by and I called him. He said, “You know I’m living out here among a lot of Lockheed people, I’ve got a swimming pool and have put a lot of money in this house and I don’t want garbage thrown in my swimming pool and all. I’ve decided the best thing to do is not send it.’’

Another guy came by and gave me a written statement. He went back to work the next day. He called me up and just begged me, “Please don’t put that statement in the evidence.” He was afraid for his job. So I didn’t use it. I didn’t want to jeopardize anybody. You see, he went out to the plant and heard the management talking and saw the “Kill Durham” signs in the restrooms. They even had my name and address and phone number on the bulletin board. And several people called me saying, “Kill Durham.”

But I was determined that I was going through with this anyway. It’s time that waste and corruption be stopped. Of course, being just an average citizen, working hard all your life, trying to be company vice president-when you see something like this you think it’s localized. But that’s not the case.

For example, right after my story appeared in The Washington Post of July 18, I received a call from a Lieut. Col. Tyce, who is deputy Air Force plant representative at Lockheed. He was all excited, and said it needed to be investigated and would I be willing to talk to Dr. Seamans, Secretary of the Air Force.

I said, of course. He said, “O.K., I’ll call you right back.” I never heard from him again.

Then when a date was set, and I was first  going to testify before Proxmire's committee Aug. 4. The colonel in charge at Lockheed-the chief Air Force representative-called me and asked me if I would talk to him.  After reflecting on it, I told him I would talk to him after I testified.

After I testified, a man named Sither, of O.S.I.—Office of Special Investigation in Washington—called me, said he was very concerned about the matter, and wanted to come down and talk to me about it. I said, “Fine, be glad to help you in any way.” After that I got to thinking. I decided I’d better call somebody and get advice on this.

I found out that I should not talk to him by myself, that I should talk to him with a witness. So I called him back and told him that I wanted to talk to him in front of a witness. He said, no, he didn’t see any need to talk in front of witnesses, but he would call me back.

A couple of days later Sither called me and said he had read the testimony two or three times and felt that at this time there was no need to talk to me. If he ever needed me, he would get back in touch.

It would seem to me that the O.S.I. would be alarmed about a situation like this and want to lay all the cards out on the table. But according to certain people in Washington, they are engaged in covering up this type of thing all the time.

They’re supposed to look after this sort of thing-not to hide it. Why would they want to hide it unless they are part and parcel of the whole thing? This bothers me a great deal; this covering up, this hiding. They’re supposed to be representing the people.

After I appeared at the Proxmire hearings in September 1971 and Proxmire asked the GAO to investigate, the General Accounting Office in Atlanta made an “in depth” investigation over a five month period. Their report contains positive, irrefutable substantiations of practically every charge I made. Yet the Washington GAO office attempted to down-grade the report calling it a staff study which had not been reviewed by Lockheed and the Air Force.

On December 2, 1972, I received a letter from Proxmire requesting my presence at hearings on December 18th, and with the letter came the Comptroller General’s final report on the charges. When I read the Comptroller General’s report, I was shocked. It was a whitewash! It ignores, obscures, or reverses the findings arrived at by the GAO’s own conscientious investigators. I set out preparing testimony that compared the two GAO reports point by point.

When I got to Washington, I smelled a rat immediately. I could sense someone was more concerned about upsetting the Comptroller General than exposing the whitewash. In fact, a key member of Proxmire’s staff attempted to talk me out of submitting my verbal testimony into the record. During the hearing, Senator Proxmire, who must rely on the GAO for most of his subcommittee investigative work, rose to the agency’s defense. He said I shouldn’t feel the GAO’s report was a whitewash since a substantial number of my charges were supported by it. His remarks were obviously tailored to salve my feelings while at the same time support the Comptroller General. It was a cop-out! Another example of political shenaniganism.

But I will not be deterred, because the principles of integrity and honesty are involved. Suppose everybody turned their backs on corruption, dishonesty, waste and collusion between big business and big government? I refuse to quit.

The Comptroller General is supposed to be the chief watchdog for Congress and therefore the people. The fact that he would release a dishonest report calculated to conceal disastrously rotten mismanagement and complicity between a large corporation and a powerful government agency means to me that he is a gutless bureaucrat. The American people must not let this be tolerated. We can’t let these people who deal in corruption and dishonesty be supported by the federal government.

Even President Nixon brashly brags that he was the one who fired Ernest Fitzgerald [the man who first exposed the C-5A cost overrun]. Why didn’t he fire the people in the Air Force and Lockheed who made the situation possible instead of the person who reported the corruption? Because he wants the votes of Lockheed workers, and he wants campaign money from the big corporations. And now Nixon has made Roy Ash Director of the Office of Management and Budget, which may be a prelude, I think, to bail-outs of all wasteful, corrupt and mismanaged defense contractors and corporations to the detriment of the common man. Maybe Nixon should appoint Dan Haughton, Lockheed’s chairman, as Secretary of Defense so that all the taxpayers’ money could be squandered!

In my opinion we no longer live in a society in which responsibilities are shared and general welfare is a common goal. We seem to be rapidly deteriorating into a type of society where it is every man for himself, where profits are more important than honesty and public welfare. I choose to be a citizen first and an employee second. The true citizen will decide that his primary allegiance is to his personal integrity rather than to his powerful employer.

We no longer have a government by the people, for the people, but a government by the corporations, for the corporations. I think it should be apparent to every American, but it isn’t. Very few Americans know that approximately 200 conglomerates control the destiny of our country. Morton Mintz and Jerry S. Cohen said it very well in America, Inc. Mollenhoff (author of The Pentagon) brought to light the tremendous power of the Pentagon. When you put those two things together, you have an awesome power. You see a picture of the huge military-industrial complex. The oil companies, too, have a tremendous power over elected officials in our country. It’s a very awesome and terrible thing that is happening to us and I think we are going to have to do something about it.

But as I say, the people, the average workers, don't know this. Somehow or other the message never gets across to them. They just go and vote Democratic or Republican or something like that.

I think the only way to save our country is through the power of votes--not rebellion or anything. I think young people, in particular, are concerned. I think we should go and start at the state level or city level and throw out the old and bring in the new.