Pentagon Nominee May Make $500,000 on Raytheon Stock
Ex-lobbyist exempt from Obama order
WASHINGTON - The man nominated to be the Pentagon's second-in-command could make at least a half-million dollars next month with vested stock he earned as a lobbyist for military contractor Raytheon.
William J. Lynn, who was chosen to be deputy defense secretary despite an Obama administration order against "revolving door" lobbyists who become public officials, has pledged to sell his stock in the Waltham-based company before taking the job.
Financial disclosure documents obtained yesterday by the Associated Press show Lynn owns Raytheon "incentive" stock valued between $500,001 and $1 million that is set to vest in February, plus "unvested restricted stock" valued between $250,001 and $500,000.
The documents also show Raytheon also gave Lynn a 2008 cash bonus of between $100,001 and $250,000 to be paid in March of this year. Lynn received a salary of $369,615 last year as a senior vice president at Raytheon, where he began working in August 2002.
As a Raytheon lobbyist until last year, Lynn worked on matters with far reach across the Pentagon, including contracting policy, the military's use of space, missile defense, munitions and artillery, sensors and radars, and advanced technology programs. Raytheon is one of the military's top contractors, with $18.3 billion in US government business in 2007.
Initially, Senate Democrats and Republicans alike balked at Lynn's nomination, citing concerns about a potential conflict of interest in running the massive department he lobbied for six years. Shortly after taking office last week, President Obama issued ethics requirements prohibiting individuals from working for government agencies they have lobbied in the past two years.
But last week, the Obama administration gave the Senate Armed Services Committee a waiver exempting Lynn from two specific sections: a two-year prohibition on employees from participating in decisions related to their former employers and a more specific section banning individuals from taking jobs in the agencies they recently lobbied.
Instead, Lynn's dealings at the Defense Department will be subject to ethics reviews for one year. Lynn's nomination is expected to move forward.
Testifying before the Senate panel yesterday, Defense Secretary Robert M. Gates said stringent ethics rules are a major reason it is difficult to fill top posts at the Pentagon and said it was time to ensure we are not "cutting off our nose to spite our face."
Gates sought Lynn as his deputy and did not want him to have to recuse himself outright from all decisions involving Raytheon because it would severely limit his ability to do his job.