John Lehman was Secretary of the Navy under Ronald Reagan, but is now an investment banker with stakes in several ship building companies:
Lehman is the founder and chairman of J.F. Lehman & Company, a private equity firm. He also sits on several corporate boards.
Lehman invested in a government-backed “Superferry” in Hawaii — a business that ultimately failed, but not before boosting the standing of Austal USA, an Alabama shipbuilder that constructed the ferry service’s ships. Austal USA’s rising fortunes in turn benefited international defense giant BAE Systems, which then bought up shipyards owned by Lehman in order to work more closely with Austal USA.
When all was said and done, the roundtrip deal helped net Lehman’s firm a reported $180 million. And besides that, Lehman continues to own shipyards that do lucrative maintenance work for the Navy.Even leaving aside the intricate ferry-and-shipyard series of deals, Lehman still stands a decent chance of profiting from the naval buildup he is helping to plan.
Lehman is one of Romney’s “special advisers” on his Foreign Policy and National Security Advisory Team, and his particular emphasis as an adviser is on the Defense work group. Lehman has spoken publicly on Romney’s behalf about the expansion of the Navy, pushing the Romney campaign’s line that the Navy needs to produce 15 new ships a year, to the tune of tens of billions of dollars. Romney believes the military must use at least 4 percent of the nation’s entire GDP, and plans to increase the military budget by an unpaid-for $2.1 trillion.
Navy ships are simply not a their smallest since 1917. But moreover, the argument that the United States should build out its ship resources is based on an outdated form of warfare. While ship production may well be declining, both the Air Force and Navy have a larger variety of specialized war vessels, such as submarines, that serve more effective and particular functions.