May 31, 2009

In Battle to Cut Billions, a Spotlight on One Man

By DAVID D. KIRKPATRICK and DAVID M. HERSZENHORN

WASHINGTON – Near the end of a two-hour hearing on a special war-spending bill this month, Senator Daniel K. Inouye, in his slow and rumbling voice, finally said the words that defense lobbyists across Washington had been hoping to hear: there was “good reason to be optimistic.”

Mr. Inouye, Democrat of Hawaii, was answering a fellow senator’s question about the future of Boeing’s mammoth C-17 cargo plane. But from Mr. Inouye, the taciturn new chairman of the Appropriations Committee, the comment was also the latest reminder that, as the Obama administration lifts its ax over hundreds of billions of dollars in military contracts that the Pentagon says it no longer needs, he is the industry’s last line of defense.

Mr. Inouye is best positioned to fulfill or frustrate the administration’s hopes of reining in runaway procurement costs. That makes him the object of intense courtship from industry executives, senators and even a certain Hawaiian in the White House.

“In the Senate, the buck stops with Chairman Inouye,” said David Morrison, a lobbyist for Boeing and a former aide to Mr. Inouye, the company with the most at stake in the proposed cuts.

Critics, though, say Mr. Inouye – a self-described “king of pork” responsible for nearly a billion dollars in earmarks each year – is also the most potent remaining champion of the parochialism that for decades has made major military projects hard to kill.

“There is no question a lot of this stuff is going to get put back by Congress,” said Senator Tom Coburn, Republican of Oklahoma. “And the question is, why? Do we need more C-17s, or are we trying to keep people employed on a weapons system that we already have enough of?” Now, Mr. Coburn said, “We’ll see what the priorities are.”

Mr. Inouye is the last of a vanishing breed of powerful old-school appropriators. His predecessor as appropriations chairman, Senator Robert C. Byrd, 91, Democrat of West Virginia, is enfeebled by age. Another former chairman, Ted Stevens, the Alaska Republican whom Mr. Inouye called “brother,” lost re-election last year amid ethics charges.

And in the House, Representative John P. Murtha of Pennsylvania, the top Democrat on the defense appropriations subcommittee, is under a cloud because of federal investigations into lobbyists, contractors and other lawmakers with ties to his office.

“Inouye is the last of the old bulls,” said Steve Ellis of the nonpartisan Taxpayers for Common Sense, which tracks Congressional spending. “The others have been gored.”

In an interview, Mr. Inouye said he seeks only the country’s security and its soldiers’ safety as he reviews the budget presented by Defense Secretary Robert M. Gates. “If we agree with the secretary, we go along,” Mr. Inouye said. “And if we don’t, we act accordingly.”

But he also hinted of conflict ahead when he takes up the main defense budget. “You’ll see some interesting activity when the big bill comes up,” he chuckled.

Elected to Congress in 1959, two years before President Obama was born, Mr. Inouye is known as a war hero and civil rights icon. While other Japanese-Americans were in internment camps, he lost his arm leading an Army unit of Japanese-Americans in World War II.

Honoring that legacy is one of many pet causes to which he has doled out federal money, including in one case to a group he helps oversee. In 2000 he inserted into the annual defense bill $20 million for a project dedicated to the sacrifices of soldiers like himself at the Japanese American National Museum in Los Angeles, where he was longtime chairman of the board of governors.

He capitalized on his official power to help finance the project in other ways as well. He helped draw donations from military contractors with big interests before his committee. Boeing recently pledged $100,000 a year for five years, a museum spokesman said. (Mr. Inouye, 84, whose first wife died three years ago, also married the museum’s then-president, Irene Hirano, 60, last year.)

Mr. Inouye has other close ties to lobbyists. His son, Daniel K. Inouye Jr., once the leader of a punk rock band, is a lobbyist for several entertainment and communications companies that lobby the senator intensely because he sits on the commerce committee. (Mr. Inouye’s son says he lobbies only the House.)

Mr. Inouye has rescued military contractors before, most notably when the Clinton administration tried to cut procurement. When the Pentagon balked at buying early C-17s – the plane it again wants to stop buying – Boeing hired a lobbyist close to Mr. Inouye: Henry Giugni, a former Honolulu police officer who had become Mr. Inouye’s closest aide and then, with his help, the Senate’s sergeant-at-arms.

A month later, Mr. Inouye, then chairman of the military spending panel, wrote to the defense secretary urging the acquisition of more C-17s, and production continued for 15 more years. Now, the pressure from all sides is far more intense. The president has repeatedly called the senator, aides say, to talk about priorities like passing the war-spending bill quickly – meaning without adding any big equipment programs.

“He calls me Dan,’ ” Mr. Inouye said. “I call him Mr. President.’ ”

Scores of defense industry lobbyists, meanwhile, are reminding Mr. Inouye of his past support for threatened programs, including the missile defense system, partly based in Hawaii, or the Army’s “future combat systems,” a pet project of his friend and fellow Japanese-American from Hawaii, Gen. Eric K. Shinseki, now the veterans affairs secretary.

As Mr. Inouye prepared for the Senate defense budget and a House-Senate conference on the war-spending bill, some of those lobbyists had a chance to speak to him at a fund-raiser this month for his political action committee at the home of the Democratic lobbyist Tony Podesta, whose firm’s clients include Boeing, Lockheed Martin and United Technologies. (All three are among Mr. Inouye’s biggest sources of campaign money.)

Dozens of senators are also beseeching Mr. Inouye to save defense jobs in their states, including 19 who have signed a letter asking him to save Boeing’s C-17.

Many lobbyists took Mr. Inouye’s cryptic “reason to be optimistic” comment as a signal that he intended to include the eight C-17s from the House’s version of the war-spending bill when it goes to conference and may add the other eight sought by Boeing in the main defense bill. Supporters of Lockheed Martin’s F-22, a plane the Pentagon has tried for years to stop buying, took heart from Mr. Inouye’s omission of $147 million requested to shut down the production line, leaving it open while the company seeks new sales either to the United States or its allies, as Taxpayers for Common Sense reported.

Mr. Inouye has kept mum about what he may seek to insert in the 2010 military spending bill. But he acknowledged feeling the pressure. “People, whenever a lot of them see me, say, ‘Congratulations, you have got a great job, chairman of the biggest committee,’ ” he said. “I don’t have the time to explain to them that I spend less time sleeping.”

Source: http://www.nytimes.com/2009/05/31/us/politics/31inouye.html?_r=1&emc=eta1