It’s that time of year, the “dead week” between Christmas and New Year’s, when people are prone to reflection. So naturally, my mind turned to one of the biggest companies in our backyard.
At the start of 2021, there was uncertainty around what lay ahead for Waltham-based Raytheon. The defense juggernaut had completed its mega-merger in 2020 with United Technologies. But the Biden administration was coming in, determined to pull out of conflicts in the Middle East and take a sharper stance against the Kingdom of Saudi Arabia, which used Raytheon bombs to commit atrocities in Yemen, The New York Times found.
Inside Raytheon, there was some concern. Last January, Greg Hayes, the company’s CEO, told investors that he expected a major arms deal with a “Middle East” customer could be scrapped. Still, he professed a universal truth: “Peace is not going to break out in the Middle East anytime soon,” he told investors, saying defensive weapons sales to the region would “continue to see solid growth.”
Now, nearly 12 months later, things are a lot clearer for one of Massachusetts’ largest employers. The company’s stock has risen 25 percent, despite $75 million in revenue loss due to America’s pullout from Afghanistan. Raytheon has made seminal advances in hypersonic missile technology, which could be lucrative as Washington enters an arms race with China.
Most notably, the Senate in early December rejected an amendment in the national defense bill that would have blocked a $650 million arms package to Saudi Arabia that could send 280 Raytheon-built missiles and almost 600 missile launchers to Riyadh.(President Biden signed the bill into law on Monday.)
The good tidings are not surprising, arms control activists and lobbying analysts found.
Anna Massoglia, an investigative researcher at OpenSecrets, a government transparency nonprofit, penned a report detailing Raytheon’s lobbying spending this year. The company has spent $12.7 million on federal lobbying in 2021, she found, making Raytheon the defense industry’s highest spender this year.
At the same time, the Government Accountability Office, a watchdog agency, found in September that Raytheon employed more former Defense Department officials — roughly 315 — than any other major defense contractor. (The revolving door between Raytheon and the government is striking. America’s current defense secretary, Lloyd Austin, is a former Raytheon board member. Mark Esper, the defense secretary under President Trump, was a former Raytheon lobbyist.)
Heading into the new year, Raytheon’s power is growing, along with Washington’s pressure campaign against its key customers. It begs the question: Will any of this hurt Raytheon’s fortunes?