Corporate boards, consulting, speaking fees: How US generals thrived after Afghanistan
When Stanley A. McChrystal was the top general in Afghanistan, he would ask his troops a question: "If I told you that you weren't going home until we win - what would you do differently?"
McChrystal recalls that question in his 2015 management manual, "Team of Teams: New Rules of Engagement for a Complex World," which says his wartime leadership techniques can guide organizations far from the battlefield toward "successful mission completion."
The failure of the American mission in Afghanistan became deadly apparent last month when the Afghan army collapsed as the Taliban took control.
But the generals who led the mission - including McChrystal, who sought and supervised the 2009 American troop surge - have thrived in the private sector since leaving the war. They have amassed influence within businesses, at universities and in think tanks, in some cases selling their experience in a conflict that killed an estimated 176,000 people, cost the United States more than $2 trillion and concluded with the restoration of Taliban rule.
The eight generals who commanded American forces in Afghanistan between 2008 and 2018 have gone on to serve on more than 20 corporate boards, according to a review of company disclosures and other releases.
Last year, retired Gen. Joseph F. Dunford Jr., who commanded American forces in Afghanistan in 2013 and 2014, joined the board of Lockheed Martin, the Pentagon's biggest defense contractor. Retired Gen. John R. Allen, who preceded him in Afghanistan, is president of the Brookings Institution, which has received as much as $1.5 million over the last three years from Northrop Grumman, another defense giant. David H. Petraeus, who preceded Allen and later pleaded guilty to a misdemeanor charge for providing classified materials to a former mistress and biographer, is a partner at KKR, a private equity firm, and director of its Global Institute.
Petraeus said several firms "aggressively sought" him for his military and CIA experience. As for his leadership in Afghanistan, he said, "I stand by what we did and how I reported it during my time." Dunford said he pushed no policy in Afghanistan but "did exactly what the president directed me to do," and that 80% of his time now is devoted to nonprofits, several serving veterans. Allen, through a spokeswoman, declined to comment.
McChrystal is the runaway corporate leader. A board member or adviser for at least 10 companies since 2010, according to corporate filings and news releases, he also leverages his experience to secure lucrative consulting contracts on topics distant from defense work, such as managing the coronavirus pandemic for state and local governments. The general, who was dismissed after being quoted in 2010 disparaging then-Vice President Joe Biden, has made millions from corporations, governments and universities, commanding six-figure salaries for some of his board positions and high five-figure speaking fees.
For a position on JetBlue's board between 2010 and 2019, he was paid a total of more than $1.3 million, disclosures show. He made roughly the same amount between 2011 and 2018 from Navistar International, a vehicle and engine manufacturer. One of its subsidiaries agreed this spring to pay $50 million to resolve claims it defrauded the U.S. Marine Corps more than a decade ago by inflating the prices of armored vehicles used in Afghanistan and Iraq. McChrystal said he had been unaware of the dispute, which did not involve allegations of wrongdoing on his part. Navistar denied the allegations and admitted no wrongdoing in the settlement.
Corporations seek out ex-military officials because they're thought to hew to ethical codes and conduct themselves well in crisis, said Megan Rainville, a specialist in corporate finance and governance at Missouri State University. At the same time, her research has found that companies advised by board members with military experience are less likely to invest in research and development and have lower value than firms whose board members lack such experience, said Rainville, a former defense industry financial analyst.
"Team of Teams," drawn from McChrystal's experience helping large organizations function more like small teams, presents the pitch his consulting firm, McChrystal Group, makes to clients as disparate as ExxonMobil and public health agencies confronting covid-19. The book also contains the lessons he delivers to students at Yale University. The retired general teaches a course called, simply, "Leadership."
Now that the war's failures have been laid bare, the leadership capabilities of those who perpetuated it should be reevaluated, said Daniel L. Davis, a retired Army lieutenant colonel who served two tours in Afghanistan. Military strategies used in Afghanistan will not aid U.S. businesses or governments, he argued.
"For years it's been payday for the generals while the war itself has been a complete disaster," said Davis, a senior fellow at Defense Priorities, a think tank urging military restraint. "At what point do we hold anyone accountable?"
McChrystal, 67, rejected that view, saying in a more than hour-long video interview with The Washington Post that he stood by his military decisions as well as his post-military earnings.
"I have built a business which has given a place for some of my old comrades to work and for a bunch of young people to have a special experience," he said.
The retired general, whose father served in Germany during the American occupation after World War II, said his personal measure is whether there's anything about his career that would disappoint his wife or, one day, his grandchildren. "And there's not," he said.
McChrystal, who endorsed Biden last fall, said it was too soon to draw conclusions about the president's move to end the war. He allowed that the 20-year conflict "has had a very disappointing outcome," but said, "I don't think that means that necessarily many of the decisions made and the strategies pursued were wrong. I think in many cases they were the best strategy that could have been."
Senior military leaders who choose to sit on corporate boards or run businesses - after commanding "thousands and thousands of people" - are acting appropriately, he said.
"It's not a bunch of people getting their snout in the trough and just trying to get rich," McChrystal said. "If you've risen to that level, you develop that skill level, that's what the opportunities that come are. And I don't think that's wrong."
The University of Nebraska at Lincoln was facing the prospect of curtailing research programs because of budgetary pressure in 2013 when it invited McChrystal to campus. For a keynote address at the university's "Building the 22nd Century" conference, the university proposed what it understood to be his standard speaking fee: $62,500.
There was a hitch. Because of a board meeting in Chicago earlier that day, McChrystal required a private jet, a representative from the general's speakers bureau, Leading Authorities, told university officials in emails obtained as part of a public records request. The fee would have to be higher: $80,000.
The university agreed, ultimately paying only $70,000, the emails show, because he made do without the jet. Asked about the fee, McChrystal said it sounded high but declined an invitation to review the contract, noting that he gives some speeches pro bono but has less control when his speakers bureau is involved.
McChrystal's value to the university, the emails specify, came from his "efforts in leadership, statesmanship, innovation, change management, and international affairs."
He brings the same insights to the boardroom, according to business executives close to the 1976 U.S. Military Academy graduate who rose through the ranks while winning academic fellowships and gaining a reputation as an ascetic, eating just one meal a day. After earning plaudits for reforming the elite counterterrorism unit known as the Joint Special Operations Command, and then directing the Pentagon's Joint Staff, he took command in Afghanistan in 2009.
But one year later, he was ousted over a bombshell Rolling Stone profile depicting him as a "runaway general" who condoned contempt for civilian leaders. He apologized at the time for his "poor judgment" and told The Post in a 2015 interview that the episode taught him to prepare for the unexpected and not put too much stock in the judgments of others.
Despite the scandal, he remained in the business world's favor partly because of then-President Barack Obama's decision to let him retire with four stars, said former military colleagues - a move that also left him with an annual, taxpayer-funded pension of at least $149,700, according to Pentagon estimates at the time.
At Deutsche Bank, he has conducted leadership training, according to two former executives, leading to a seat on the board of the bank's U.S. holding company. "Senior management is much more likely to listen to military commanders because they're cool and they've killed people than to a McKinsey guy in a pinstripe suit," said a former senior Deutsche Bank executive who, like some others, spoke on the condition of anonymity to discuss human resources issues. A Deutsche Bank spokesman declined to comment.
A former vice president at Knowledge International, an Alexandria, Va.-based affiliate of an Abu Dhabi company that says it "exports close to $500 million annually in defense services and products," mostly to the United Arab Emirates, said McChrystal was "valued for his name and gravitas that he brought to the board."
McChrystal said he joined the board of Knowledge International, which did not respond to a request for comment, because a former boss, retired Gen. Bryan D. "Doug" Brown, asked him to. In an interview, Brown said the board members, by handling the authorizations for overseas defense work, were "the good guys in the equation - making sure everyone is moral, legal and ethical going over there." He called McChrystal "one of the finest officers and people I've ever known."
McChrystal's obligation in Chicago that led his speakers bureau to request a private jet was a meeting of the board of Navistar International, the manufacturer based in Lisle, Ill., he said. When McChrystal was named to the board in 2011, Navistar's chairman said, "His years of military leadership and service will be of great value to Navistar as we further expand our global and military businesses."
While commercial vehicles represent the heart of Navistar's business, McChrystal said, the company began making mine-resistant vehicles, known as MRAPs, "during the war in Iraq and Afghanistan, when suddenly there was this need." Its traditional trucking sales began contracting in 2005, he said, but revenue from the military-grade equipment "hid that problem" during the height of the two wars.
In 2013, a Navistar contract director filed a whistleblower complaint alleging the company had forged invoices and pricing information for MRAPs sold to the U.S. government between 2007 and 2012. McChrystal, who joined the board in 2011, was on its finance committee at the time of the complaint, and earned about $200,000 annually, corporate filings show.
The U.S. intervened in the whistleblower suit in 2019, arguing in the U.S. District Court for the District of Columbia that the fraudulent documents had duped the government and cost it at least $1.28 billion.
The matter had come into public view before then. In 2016, Navistar divulged in an annual report that it had received a subpoena from the Pentagon's inspector general related to its sales of military vehicles to the government. The company did not respond to a question about what it told the board about the underlying complaint, pointing instead to public filings that spell out the board's responsibilities. McChrystal, who left the board in 2018, said he was unaware of the claims until this spring, when he read about the settlement in the news.
An attorney for the whistleblower, H. Vincent McKnight Jr., said he remains troubled by what he sees as ill-gotten gains, especially because the scheme exploited the American military and taxpayer.
"The company profited from that behavior and so did the board members," he said.
As coronavirus cases surged in Virginia earlier this year, state officials went shopping for books. The health department ordered 53 copies of McChrystal's "Team of Teams," for a total cost of more than $1,000, July procurements records show.
The supplier was McChrystal Group, the boutique consulting firm founded in 2011 by the retired general. It has since grown to about 85 employees, he said.
The firm, built on the idea that McChrystal and his colleagues "could capture the lessons they learned in counterterrorism and translate them into the private sector," has advised clients including Bank of America, the National Basketball Association, Monsanto and MedStar Health. Its government work began two years ago, McChrystal said, when the firm ran leadership training for the Department of Homeland Security's cyber unit and for the U.S. Secret Service.
Then a new opportunity arose. Last year, the firm began advising state and local governments on covid-19 response - one of many consulting companies that secured no-bid contracts to fill gaps in public health agencies overwhelmed by the crisis.
McChrystal Group's services focused especially on leadership development based on the principles in "Team of Teams," state records show. A Virginia health spokeswoman, Tammie Smith, said McChrystal's books were purchased for the department's work on "culture change dynamics." All told, McChrystal Group has billed the state more than $5.7 million over the last 20 months, records show.
The firm also consulted on pandemic response for the city of Boston and the state of Missouri, for fees of more than $1.1 million and about $2.2 million, respectively.
In those cases, hardly any of the consultants identified in the contracts had public health experience, as indicated by their LinkedIn profiles. Two were recent Yale graduates and members of the football team, which McChrystal takes on a trip each year to the battlefield at Gettysburg.
"We weren't experts in public health," McChrystal acknowledged. "But we're good at getting networks to communicate and come out with the right answer and implement."
He added, "The problem in covid has never been a lack of public health knowledge. The problem in covid has been the inability of larger organizations to share information, and the lack of political leadership to do what we already know is the right answer."
Marissa Levine, a former Virginia health commissioner who now directs the University of South Florida's Center for Leadership in Public Health Practice, questioned that premise. Leadership training for public health requires specialized expertise, she said, because it differs from a business, being accountable not to shareholders but to "everyone in a community."
But some officials said the firm's services were crucial. The consultants served as the "nerve center of our response," said Brian P. Golden, director of the Boston Planning and Development Agency. They led an 8 a.m. call and then managed tasks arising from the conversation, he said. "McChrystal Group was the enforcer all day."
"We certainly could have figured this stuff out ourselves, but we had no time to waste," Golden said.
The firm's responsibilities were sweeping. The contract provided that McChrystal Group would "review and advise of all city plans."
A spokeswoman for Marty Walsh, the former mayor who hired McChrystal's team in Boston and now serves as Biden's labor secretary, did not respond to a request for comment about the firm's performance or the "weekly one-on-one executive consultation" promised to him in the contract. McChrystal said Walsh recently dined at his home in Alexandria, Va.
The retired general said his firm comes comparatively cheap. "We cost a fraction of what a traditional consulting firm comes in," he said. His own pay is a "fraction" of what he would make in a larger company, he said, while declining to say how much he earns.
The fees in Missouri, about $250,000 per month, struck a former senior state official as too high for a small number of consultants. The former official, speaking on the condition of anonymity to address the response candidly, said the consultants interfered with the ordinary chain of command, causing more disruptions than upgrades. Kelli Jones, a spokeswoman for the governor, said the consultants helped "pull teams together within our state government to drive quick and effective action across every line of effort in the covid-19 response."
Many of the firm's recruits come from Yale, where McChrystal has taught since 2010. "You fish in the pond you're standing around," he said.
McChrystal's course on leadership is "almost legendary," said James A. Levinsohn, who directs the Yale institute where McChrystal teaches. Student evaluations reviewed by The Post reflect that status. One said it was useful "if you have any aspirations to climb a corporate ladder, serve in a leadership position, or just be a valuable member of team." Complaints were sparse, but one bemoaned the complexity of the text assigned from Confucius, the ancient Chinese philosopher.
Central to McChrystal's philosophy is the belief that all Americans should serve their country, inspiring his pro bono work as board chairman for Service Year Alliance, a nonprofit seeking to expand opportunities for a year of paid, full-time service. The retired general's support has been a major asset, said John Bridgeland, the nonprofit's vice chairman and a former director of the White House Domestic Policy Council.
Bridgeland said it was only natural for McChrystal to take on corporate work as well.
"People have to feed their families," he said.
The Washington Post's Alice Crites contributed to this report.