At first glance, David S. Lewis would seem to hold one of the most enviable positions in corporate America. As chairman of St. Louis-based General Dynamics, he presides over the top U.S. defense contractor and No. 1 beneficiary of the Reagan military buildup. Megabuck contracts to build weapons such as the Trident nuclear-missile submarine, F-16 fighter plane and M-1 tank helped General Dynamics reap revenues last year of $7.8 billion and profits of $382 million, up 33% from 1983.
Yet Lewis these days could hardly be more uncomfortable if he were the target of a barrage of his company Tomahawk cruise missiles. Fleets of investigators and critics are challenging General Dynamics' integrity and its fitness to be a pillar of the nation's defense, raising charges far more extensive than those leveled against General Electric last week. The Pentagon attack on General Dynamics' expense reports and the Justice Department probe into overruns on the company's SSN 688 Los Angeles-class submarines are only the most publicized of many investigations. The Securities and Exchange Commission is studying whether the company may have manipulated its stock price, and the Defense Department is looking into possible national security violations.
For the second time in a month, Lewis was publicly grilled last week by a House Energy and Commerce subcommittee chaired by Michigan Democrat John Dingell. Among other things, Dingell and his colleagues demanded to know why General Dynamics charged the Government for such "overhead" costs as a $14,975 party at a suburban Washington country club and the babysitting expenses of one of its officials. Lewis admitted that some of the billings were improper and announced that General Dynamics was withdrawing $23 million | of its expense claims for the period from 1979 to 1982, or about one-third of the $64 million the Pentagon's Defense Contract Audit Agency is questioning.
Another accusation made during the House hearing was that General Dynamics had discussed a submarine deal with a top Navy official while simultaneously talking to him about his leaving the Pentagon and coming to work for the company. Lewis revealed that in March 1983 he telephoned George Sawyer, an Assistant Secretary of the Navy. Having heard that Sawyer intended to take a job in private industry, Lewis suggested that the official might want to learn more about General Dynamics. Later that month Sawyer spent a day at the company's St. Louis headquarters. On May 3 Lewis called Sawyer to say that General Dynamics had "developed a job that we thought he might be interested in that would have no conflict of interest." All the while, Sawyer was continuing his official dealings with General Dynamics, and on May 5 he authorized the Navy to negotiate a sub-building contract with the company. In June he became an executive vice president of General Dynamics. Responding to criticism of the Sawyer affair, Lewis contended that General Dynamics had not started job negotiations with Sawyer until after he had disqualified himself from doing Pentagon business with the company. Sawyer has denied that there was any conflict of interest.