Labor & Employment Law

Is U.S. Air Force Flying Cover for EADS in Tanker Fight?

By Mike Hall

With 50,000 jobs at stake in the $35 billion contract battle over a new generation of in-flight refueling tankers, the U.S. Air Force “seems determined to help European businesses rather than our own,” says John Wolcott, editor of  the Snohomish County Business Journal.

Wolcott is the latest voice to weigh in about the long and controversial fight that has pitted U.S-owned Boeing with “50 years of experience in producing aerial tankers” against the French-based, European consortium, EADS/Airbus.

The stakes are high. Granting the contract to Boeing would create at least 50,000 family-supporting jobs, save taxpayer dollars and protect fair trade laws.

But if EADS wins the contract, most of the jobs would be in Europe. The few thousand jobs created here under an EADS contract would be low-paid assembly jobs with no union representation.

Wolcott writes that in 2008, when the Air Force surprised most observers and awarded contract to EADS, (at the time partnered with Northrop Grumman),

Boeing challenged the contract award, noting that the USAF had accepted the larger EADS 330 model aircraft rather than Boeing’s Everett-built 767?even though the military had originally told Boeing that it wanted the smaller aircraft.

The contract was rebid this year after the U.S. Government Accountability Office (GAO) upheld Boeing’s protest and EADS said it was dropping out of the bidding. But this spring, EADS announced it would bid alone for the contract. Says Wolcott:

…the only reason EADS is back in the competition is that the Air Force pulled another surprise, announcing it would extend the deadline for submitting bids from May 10 to July 9 if EADS wanted to compete. So, once again, EADS was back in the picture.

While the Air Force repeatedly claimed it wants fair competition, it favored EADS with an extended deadline, even though Boeing was ready to meet the May 10 date after EADS pulled out.

Not only does the Air Force seem to be bending over backward to keep EADS in the bidding, Wolcott writes it also is ignoring a March ruling by the World Trade Organization that found EADS has been receiving illegal subsidies from European governments for years, what Wolcott describes as “another example of unfair competition.”

Specifically, the WTO found that EADS has been getting illegal subsidies for years for its A330, the plane EADS wants to offer in the tanker competition…All of this is going on at a time when America’s economy has been weakened by government policies and global economic events, yet there seems to be no end to Air Force efforts to bring EADS into the competition for the new tanker.

American military aircraft, particularly, need to be built in this country. We need to rely on our own financing, construction and security resources to build our own fleets of military aircraft.

Click here to read Wolcott’s column.

Full post as published by AFL-CIO NOW BLOG on May 08, 2010 (boomark / email).