It may seem a wonky piece of trivia that a man named Michael Brown withdrew his nomination last week to be the Pentagon’s acquisitions chief. But in fact, it’s a national security disaster, a retreat from a promise of major reform in the way the U.S. military buys weapons, a process currently controlled by one of Washington’s most sclerotic bureaucracies. It is also worth noting that Brown’s withdrawal was forced by an enabler of that bureaucracy.
Brown is currently the head of the Defense Innovation Unit, a small branch of the Pentagon, based in Silicon Valley, which was created in 2015 to apply breakthrough civilian technology to military needs.
The idea for DIU was spawned in 2006, when an F-16 pilot named Raj Shah—who later became the unit’s president—was flying combat missions in Iraq. His cockpit’s GPS screen showed him the coordinates for his targets, but there was no overlaid image—no moving dot or icon—that showed where he was in relation to those coordinates. During his home leave, he bought an iPAQ, one of the early pocket PCs, and loaded it with a standard, cheap aviation-map program. Back in his F-16, he strapped the pad to his lap and relied on it for navigation, ignoring the plane’s multimillion-dollar mil-spec software.
Shah realized that commercial technology was racing ahead of the U.S. military’s—a dangerous trend, given the nation’s reliance on its technical edge to win wars.
President Barack Obama’s last secretary of defense, Ashton Carter, set up DIUx (as it was called then, the “x” standing for experimental) to fill the gap. It was a rambunctious office at first, bitterly resisted by the Pentagon weapons bureaucracy—and not so welcome in Silicon Valley, where executives tended to distrust government. The few executives who took a meeting with DIUx were disappointed. In the business world, a meeting generally ends with a decision. In the defense world, a meeting ends with another meeting, which might lead to a “requirement” written by one of the military services, which the acquisitions bureaucrats would translate into a “request for proposal,” to which corporations would respond with product designs, which other bureaucrats would evaluate, leading to a contract for a prototype, followed by testing, then finally a contract for a weapon—a process that took (and still takes) years, by which time the technology would be two or three generations outdated. All along, the officers who wrote the original requirements would never speak to the corporate managers who built the resulting weapon.
DIU’s aim was to bring business practices and schedules into the world of weapons systems—starting out with small stuff, gradually scaling up. They worked under an obscure law governing “Other Transaction Authority,” or OTA, allowing contractors to bypass the onerous rules and regulations while designing prototypes. This authority was created in the 1950s to allow NASA to keep up with the Russians in the space race. Much later, the Defense Advanced Research Projects Agency invoked OTA in its highly celebrated Cyber Fast Track program, which resulted in the awarding of 130 contracts, no more than two weeks after the initial proposal, at an average cost of $150,000.
In 2015, the year of DIU’s founding, Congress passed an amendment, known as Section 815, allowing OTA contracts for a wider range of projects, as long as a senior official affirmed that they enhanced “military effectiveness.” This gave DIU a mandate to expand its mission—and assured Silicon Valley companies that they could bid for a contract and hear back on its success or failure in a matter of weeks.
Brown became DIU’s president in 2018, just as business was taking off. He was ideal for the job, having experience in Washington (as a White House Presidential Innovation Fellow who wrote the first paper warning of China’s military use of Silicon Valley software) and in technology (as CEO of Symantec, Quantum Corporation, and EqualLogic, leaders in cybersecurity and data storage). Under his leadership, DIU has contracted 95 prototypes, nearly half of which have entered production.
In short, if the Pentagon’s acquisitions bureaucracy was going to step into the world of cloud computing, A.I., 5G, cybersecurity, and autonomous command-control (the areas of most of DIU’s projects), Brown was ideally suited to take charge.
On May 28, 2020, on his last day of his job as DIU’s chief technology officer, a civil servant named Bob Ingegneri filed a complaint with the unit’s supervisors, charging Brown with violating standard practices—specifically, paying friends and colleagues higher-than-normal salaries to come work for the unit, in violation of regulations.
The supervisors gave the complaint to DIU’s new lawyer, who had just taken the job. The lawyer wrote an 80-page report, rebutting all but one of Ingegneri’s complaints. It turned out some of the complaints were untrue, and others referred to payment practices that Congress had allowed for DIU and DARPA, so they could hire experts who would be unlikely to work for civil servant salaries. More than that, the salaries that Brown offered had been approved by Washington Headquarters Services, which one Pentagon official told me is the “stodgiest bureaucracy of them all—if they didn’t think Brown was doing wrong, then he wasn’t doing wrong.”
That was the end of the contretemps, until this past April, when the Biden administration nominated Brown to be undersecretary of defense for acquisitions—a move that everyone saw as a green light for innovation in defense contracting. Kathleen Hicks, the deputy secretary of defense, touted DIU as a model of innovation. Shortly after his Senate confirmation, Colin Kahl, undersecretary of defense for policy, made a publicized trip to its headquarters.
But then, Ingegneri filed his old complaint to the Defense Department’s inspector general. He also called a number of reporters, rousing a couple of them, from Defense One and FedScoop, small news sites but widely read within the national security bureaucracy, to write stories. Those stories roused attention from other, larger papers and from senior officials. The officials made inquiries to the IG, who told them that the investigation into Brown could last anywhere from a few months to a year. It was this comment—the possibility that the Pentagon job might be left open for a year—that prompted Brown to withdraw his nomination. He remains the head of DIU. (Ingegneri, who now works at a consulting firm, did not respond to a request for an interview. Neither did Brown or the IG’s office.)
A longtime defense consultant who read the complaint and the DIU lawyer’s earlier rebuttal told me he was puzzled by the IG’s estimate. It seemed to the consultant that Brown had done nothing wrong; even a thorough investigation would take no longer than a month or two. However, he also knew that merely saying that it might take as long as a year would, in effect, kill the nomination—and the IG must have known this when he said so.
The Pentagon’s inspector general has long been hostile to the “Other Transaction Authority” contracts that DIU and a few other agencies have invoked. This past April, the IG published an audit criticizing the whole practice of OTA as hindering oversight, transparency, and accountability. In a sense, the report is right—the whole point of OTA is to allow innovative projects to evade the normal, sluggish procurement process. But the report doesn’t point out that Congress and previous defense secretaries have allowed these evasions for this purpose. Nor does it point out the power struggle that’s implicit in this audit—that DIU and other units like it pose a challenge to the IG’s authority and purpose.
It is also a bit ironic that the IG is complaining about the somewhat closed nature of contracts worth a few tens of millions of dollars, when multibillion-dollar projects lumber through the process, checking every box and crossing every T, winding up with enormous cost overruns and weapons that don’t work—which the IG then criticizes, a dozen years too late, for excess costs and underperformance.
In other words, the IG is inclined to look askance at the prospect of Michael Brown, the head of DIU, running the Pentagon’s entire acquisitions shop. It may explain why officials were told the investigation could take a year.
Meanwhile, there is nothing the Pentagon or anyone else in the Biden administration can do about it. Trump fired five IGs for investigating corruption and malfeasance in his administration. Biden made a commitment to ensuring the independence of IGs across the federal agencies—properly so—and therefore can’t interfere, can’t even intrude to ask questions, on a matter like this.
“The IG does valuable work, but over the years, some people have weaponized the IG, tied up people’s careers for months or years, sometimes to the detriment of security,” one former Pentagon official told me. “That seems to be what’s going on here.”
Bill Greenwalt, a defense analyst at the American Enterprise Institute who wrote Section 815 when he was a staffer on the Senate Armed Services Committee, agrees with that point, telling me that the IG has “long been hostile to changes in law that allow flexibility and alternative approaches.”
He added, “Make no mistake, Brown would have shaken up the system, and the losers would have been the Chinese, the traditional defense contractors, and public employees who don’t want to change to meet the threats of our times.”