A curious thing, and some would say a suspicious one, happened on
the morning of September 10, 2008. On the floor of the House of
Representatives, Members representing districts where the Boeing
Company had a heavy presence began cheering and celebrating. But
Members representing districts with closer ties to the Northrop
Grumman company had no idea what was going on.
Eventually the news came out: Deputy Secretary of Defense Gordon
England and other Pentagon officials had called interested
Members to tell them the Pentagon had decided to completely
cancel the existing competition between Boeing and Northrop
(along with the European Aeronautic Defense and Space Company
North America, or EADS) for a desperately needed new Air Force
refueling tanker. Northrop had won the competition until a
semi-successful Boeing protest and was widely expected to win it
again. But it seemed that all the Boeing-friendly Members got the
cancellation news first — news that, translated, meant they
could start over from scratch a competition they had thoroughly
lost.
That very night, at a gala to celebrate the next day’s scheduled
dedication of the Pentagon Memorial (in remembrance of 9/11),
England and other top Pentagon brass sat as guests at the table
sponsored by Boeing.
Boeing has long had an incredibly cozy relationship with the
Pentagon — sometimes too cozy. In 2001, the Air Force had
awarded a lease/buy tanker contract to Boeing, but it was
canceled after a John McCain-led investigation sent several
Boeing and Pentagon officials to jail for corruption relating to
the award.
Defense Secretary Robert Gates already owns a home in Big Lake,
Washington, 55 miles North of Seattle, Boeing’s original
headquarters and still one of its biggest manufacturing sites.
His children also have extensive Seattle ties. Incoming National
Security Advisor James Jones was a member of Boeing’s board until
December 15 of 2008. Boeing’s corporate headquarters is now in
Chicago, political home of incoming President Barack Obama and
his chosen chief of staff Rahm Emanuel, who was one of the most
angrily outspoken congressmen when Northrop was announced as the
competition winner last Feb. 29.
Most experts in the outside trade press had already written by
then that Northrop had the better plane, and subsequent testimony
showed that Northrop also had offered to build the first 68
planes in this 179-plane contract for $2.9 billion less than
Boeing would have charged. Yet when Boeing protested on more than
100 counts, a Government Accountability Office (GAO) analysis
upheld just eight of the more minor procedural (not substantive)
complaints — and even there, some observers smelled a rat. One
of the unions with significant Boeing membership — but not
Northrop membership — is the International Federation of
Professional and Technical Engineers. The IFPTE also has members
who work for GAO, some of whom actually worked on the tanker
protest analysis.
And in Congress, Boeing seems to have more clout — or at least a
far more impassioned group of Members as advocates, ones far more
willing to use open threats and other hardball tactics. Truth be
told, their intensity on the subject in many cases borders on the
bizarre. Witness the scene at one of the national political
conventions this summer where a columnist was chatting very
amiably on a number of topics with a congressman who always had
been most friendly — and then, when the columnist asked in
passing if there were any news on the tanker contract, the
congressman’s demeanor changed markedly. Raising his voice,
jabbing his finger for emphasis, suddenly red-faced, the
congressman erupted into an absolute rant about how the award for
Northrop/EADS would be giving jobs to Europeans (because of the
EADS component of it) instead of Americans.
NEVER MIND THAT NORTHROP also is responsible for a host of jobs
in that congressman’s own district. Never mind that nearly a
third of Boeing’s proposed plane would feature parts built
overseas, and that overall Boeing is outsourcing more and more
jobs abroad, including breaking ground for a $21 million
expansion for a plant in China last November while boasting of
having bought more than $1.5 billion of aviation hardware from
China in the past two decades and promising to double that in
coming years. Boeing also is a partner in the Moscow (Russia)
design center, with 2,000 employees there.
And never mind that independent (not Northrop-sponsored) analyses
show that if Northrop gets the tanker it will create some 48,000
new direct and indirect jobs in the United States — some 4,000
more than the Boeing version — with 230 suppliers based in all
50 states. The Northrop plane itself would be assembled in a new,
labor-intensive plant in Mobile, Alabama, with crucial, satellite
economic boosts throughout the Gulf Coast from Louisiana into
Florida.
Mobile County Commissioner Stephen Nodine put it in perspective:
“The Gulf Coast has been devastated by four major hurricanes
[just beginning with Katrina; the year before Katrina saw four
storms inflict major damage on the eastern Gulf Coast] and is
trying to rebuild our economy. If Obama and his administration
want to make a statement about rebuilding the Gulf Coast, and get
the best plane for the job… this is the way to go to reward
American ingenuity and American resolve on the Gulf Coast.”
Nodine has helped secure resolutions of support for the Northrop
bid from city councils in virtually every coastal town from New
Orleans to Melbourne, Florida.
U.S. Rep. Jo Bonner of Mobile adds a broader perspective, noting,
as have many others, that the current tanker fleet is five
decades old and becoming more and more dangerous to fly, with
fewer and fewer of the planes available for use at any one time.
“Do we no longer need to project strength and purpose around the
world?” he asked. “All over the world there are hot spots that
could require American leadership at a moment’s notice.… For
years, everybody in Congress and the Air Force has agreed this is
the nation’s Number One military acquisition priority… that the
tanker is the glue that keeps everything else [involving the
ability to “project force”] together. We have to get it right
sooner rather than later.”
That last point is important: It is generally acknowledged that,
whatever the other merits of the two competing planes, the
Northrop plane will be ready to come off the assembly line far
sooner than the Boeing one.
Bonner also said that a President Obama would have an incredibly
difficult time building the promised better relationship with
Europe if his administration rejects a plane merely because one
of the plane’s two main corporate builders is a primarily foreign
— European — company.
“This is the man who stood before 1 million people in Berlin. He
can’t go back to Europe with all the challenges in the world and
begin to build his promised partnerships but then say, by the
way, we’re not going to use products that have any European
connections.”
Finally Bonner pronounced himself unconcerned about incoming
National Security Advisor James Jones’ service until last month
on Boeing’s board of directors: “General Jones wore the uniform
of his country long before he wore a suit as a Boeing corporate
board member…. And with all the criticism of Vice President
Cheney’s past ties to Halliburton, does the Obama administration
want to be accused” of showing favoritism of a similar nature in
making such a big decision?
NEVERTHELESS, POLITICS does talk in Washington. Boeing’s
unprecedented hardball campaign to reverse Northrop’s tanker
award, with arm-twisting in Congress and a high-profile and nasty
advertising campaign against its competitor, has made it clear
that if Northrop again wins the competition when it is renewed
this year, Boeing will continue to press every appeal it is
allowed, no matter how long it takes. But an award to Boeing,
after such a clear initial victory by Northrop, would almost
certainly lead Northrop to take the battle to court — where it
would probably have quite a strong case. And the longer all this
goes on, the longer our servicemen will have to wait for a tanker
to replace the half-century-old fleet. That would be
unforgivable.
As 22 retired Air Force generals wrote in a letter last summer,
“Delays in the tanker program will only serve to put the lives of
crews flying these aging systems in greater jeopardy.”
The best answer — the one that solves all the politics, that
delivers the planes the soonest, and that forces both companies
to be at their best in order to keep the business — is the one I
advocated on these pages back in July of 2007: “The best idea
might not be to give the whole award to Northrop or to
Boeing, but to split it up.”
The first set of 68 planes in the first contract of 179 planes
will take years for either company to fill, and eventually the
entire fleet of 510 planes must be replaced. Why not keep both
companies on their toes, forcing them to do good work by
splitting the first batch while keeping the competition open for
subsequent batches?
In the summer of 2007, many thought that idea preposterous. But
in late September of 2008, powerful Defense Appropriations
Subcommittee Chairman John Murtha of Pennsylvania told “Inside
the Air Force” that (quoting the story’s lead paragraph) “The Air
Force will have no choice but to split the… tanker award between
rivals Boeing and Northrop Grumman-EADS if it wants to receive a
new tanker anytime soon.”
The Pentagon darn well ought to listen to Murtha. If its splits
the award before the end of February or even March, the first
planes can begin being assembled by Northrop-EADS this autumn.
But time’s a-wasting, and our military personnel are at
increasing risk.
As Alabama Gov. Bob Riley told me last week, “We believe in
competition. We believe in value. That’s what it means
to be pro-American.”
