IF YOU THINK Ivan Boesky got off easy, you should hear about Morton-Thiokol, Inc.
Morton-Thiokol manufactured the booster rocket which caused the space shuttle Challenger to explode last January, killing seven astronauts, destroying hundreds of millions of dollars in hardware, and crippling--perhaps irreparably--the U.S. space program.
The problem, you may remember, was traced to a rubber O-ring in the right-hand booster. O-rings may sound insignificant, but they're not. One Air Force official compared the space shuttle's dependency on O-rings to an airplane's dependency on wings. NASA rates O-rings as items of "Criticality I," meaning that their failure could result in the destruction of the space shuttle.
Did Morton-Thiokol treat the O-rings with the scrutiny and care befitting a crucial shuttle component? You decide. In a subcontractor's assembly plant, inspectors found workers storing their lunches in refrigerators alongside strips of rubber used to manufacture the crucial seals. Workers were also found to be using paint marks on the floor to measure the O-rings. And in one Morton-Thiokol plant, an Air Force inspector discovered that new and used O-rings were stored in the same area. In his report, he speculated on the "possibility of intermixing" them during the assembly of the rocket boosters.
MAYBE THIS SHOULDN'T shock us. We've heard about the ineptitude of military/defense contractors before. But after Morton-Thiokol had actually delivered the rocket boosters to NASA, against common sense only multiplied.
Six months before the Challenger disaster, one Morton-Thiokol engineer wrote a memo urging that all shuttle flights cease until questions about O-ring performance could be resolved. Management ignored that advice.
Then, on the eve of the doomed launch, 15 Morton-Thiokol engineers agreed--unanimously--that NASA shouldn't launch the Challenger. They were fearful that overnight sub-freezing temperatures at the Kennedy Space Center would prevent the O-rings from functioning properly. (Morton-Thiokol had never bothered to test the rings' performance at such low temperatures).
Thiokol Executive Vice President Gerald Mason told one of the 15 skeptical engineers to "take off his engineering hat and put on his management hat." Unfortunately, four top executives did just that. They vetoed the engineers' recommendation, and NASA subsequently launched the Challenger in 38-degree weather.
Just over a minute later, the shuttle was consumed in a spectacular fireball.
That's the end of the story for seven astronauts, but not for Morton-Thiokol. Its reaction to the disaster was to find new jobs for two of the engineers who had protested most vociferously against the doomed launch. William Rogers, chairman of the Presidential Commission which investigated the disaster, was correct when he said, "It would seem to me...they should be promoted, not demoted or pushed aside."
GIVEN MORTON-THIOKOL'S bungling, we might expect public outcry against the company. But response has been virtually non-existent. Some remarks have actually been favorable.
The ever-optimistic mayor of Brigham City, Utah, home of a Thiokol plant, said, "It was an unfortunate incident, we have had an awfully good safety record in the past." He added "You can't discount the fact that we have had 24 successful launches."
Actually, it's easy to discount that fact. Especially when you consider that during the course of several of those launches, O-rings were dangerously eroded, and Morton-Thiokol knew it.
So how is Morton-Thiokol paying for its miscues? With a whopping fee? With the termination of its NASA contract? With national disgrace?
None of the above. Officials at the Marshall Space Center recently announced that the maximum "fee reduction" which Morton-Thiokol would receive is $10 million. That's one-tenth of Ivan Boesky's fine. It's not nearly severe enough to be called a slap on the wrist.
On the other hand, NASA officials are considering bestowing a $75 million "incentive award" on the company.
Morton-Thiokol bears a large portion of the blame for the Challenger disaster. At the very least, it should pay dearly for its miscalculations.
Perhaps a nine-digit fine would convince Morton-Thiokol and other contractors to temper their worship of divine Profit with some common sense.