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Shanahan Resigns as Pentagon’s Number-Two, Withdraws Nomination for SecDef Position

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Acting Defense Secretary Patrick Shanahan has withdrawn his nomination to officially become the Pentagon’s top civilian and will also resign as deputy defense secretary as “a painful and deeply personal family situation from long ago” has come to light, he said June 18.

“I would welcome the opportunity to be Secretary of Defense, but not at the expense of being a good father,” Shanahan said in a statement issued by the Defense Department Tuesday. “After significant reflection, I have asked to be withdrawn from consideration for Secretary of Defense and will resign my position as Deputy Secretary of Defense. I will coordinate an appropriate transition plan to ensure that the men and women in harm’s way receive all the support they need to continue protecting our great nation.”

Department of Defense Deputy Secretary Patrick Shanahan addresses the crowd at the 243rd Army Birthday cake cutting ceremony, Pentagon, Washington, D.C., June 14, 2018. (U.S. Army photo by Daniel Torok)

The statement came shortly after President Trump tweeted that Shanahan had withdrawn his nomination. Trump added that he has chosen Army Secretary Mark Esper – an Army veteran and former Raytheon [RTN] executive – to serve as the next acting defense secretary.

Shanahan, who was confirmed as deputy defense secretary in July 2017 after a 30-year career at Boeing [BA], said in the statement he was proud of the work accomplished over his two years at the Pentagon, citing “significant progress rebuilding and modernizing the military” to counter China and Russia, and developing advanced capabilities related to space, cyber and hypersonic missiles. Trump announced his intent to nominate Shanahan to the position May 9, but multiple outlets reported this week that his nomination had been held up before being sent to the Senate due to FBI probes into his personal family life.

Lawmakers on Capitol Hill appeared to be caught unaware by Trump’s midday tweet, but overall said they look forward to meeting with Esper to learn more about his plan for the department as acting chief.

Esper was confirmed by the Senate Armed Services Committee (SASC) to become Army secretary in November 2017. He was Trump’s third pick to lead the service, and was confirmed by a vote of 89-6 (Defense Daily, Nov. 15, 2017).

A West Point graduate who was in the 101st Airborne Division and served during the first Gulf War, Esper retired from the Army after 21 years of service. He also served as chief of staff at the Heritage Foundation, a conservative think tank in Washington, D.C., and on the staff of several Senate committees and members, including then-Republican Sen. Chuck Hagel of Nebraska, who went on to lead the Defense Department from 2013 to 2015.

Before becoming Army secretary, Esper served as Raytheon’s vice president of government relations beginning in 2010, overseeing such programs as the Patriot air defense system radar, the canceled Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System (JLENS) and the Distributed Common Ground System (DCGS).

The late Sen. John McCain (R-Ariz.), who served as chairman of the Senate Armed Services Committee from January 2015 until his death in August 2018, scrutinized Esper’s industry past during his confirmation hearing in 2017 (Defense Daily, Nov.2, 2017).

Shanahan’s past as a longtime Boeing executive was also parsed by McCain during his own confirmation hearing for deputy defense secretary, and has remained a key issue to his critics. In April, the Defense Department’s Office of the Inspector General (DOD OIG) issued a report clearing Shanahan of any potential ethical wrongdoing after the nonprofit watchdog group Citizens for Responsible Ethics in Washington (CREW) issued a complaint regarding alleged comments disparaging Boeing’s defense industrial competitors Lockheed Martin [LMT] (Defense Daily, April 25).

CREW was quick to issue a statement Tuesday noting Esper’s past at Raytheon and warning of his “potential influence” as acting defense secretary over deals involving the weapons maker, which last week announced its plans to merge with United Technologies Corps.’ [UTX] aerospace business (Defense Daily, June 9).

Esper’s “ethics agreement – and his ability to follow it – will be something we will be watching closely,” CREW said.

The Army has not yet announced who will take Esper’s place as Army Secretary as he transitions to the acting defense secretary position. Undersecretary Ryan McCarthy, a former Army Ranger, served as acting service secretary from August to November 2017, after former Secretary Eric Fanning resigned and before Esper was confirmed.

David Norquist, the DoD’s chief comptroller, has been serving as acting deputy defense secretary, but his nomination has not yet been sent to SASC for consideration.



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