Within days, the Obama Pentagon is expected to decide which supplier to rely upon for what is, arguably, the cornerstone of America’s ability to project power for the next 40 years: the next-generation aerial-refueling tanker known as the KC-X. The choice for this role - which is worth conservatively $40 billion - would seem to be a no-brainer. The obvious winning candidate to produce and maintain 179 tankers for decades to come would be a reliable, experienced and responsible U.S. manufacturer: Boeing.
It seems, however, that Team Obama is poised to entrust responsibility for this vital defense capability to a company that has none of those attributes - the European aerospace conglomerate EADS. The pretext apparently will be that the foreign competitor is offering a lower bid than its American counterpart.
This claim is preposterous on its face. The Lexington Institute’s Loren B. Thompson, one of Washington’s most respected defense-program and budget analysts, noted recently that each of the two bidders has to satisfy 372 mandatory performance requirements. “Thus, the key discriminator in who wins becomes price.” Meeting or substantially undercutting Boeing’s bid is problematic because the Airbus tanker based on the A330 is 28 percent larger, with 40 feet more wingspan than Boeing’s derivative of the 767. “It appears that is exactly what the European company plans to do, raising the obvious question of how such a bid is possible.”
How, indeed? The answer is not so hard to fathom if you look at the nature of EADS. As the Center for Security Policy documented in a white paper issued in September 2010, the company has relied on devious, unethical and unfair practices to buy into or otherwise win contracts. It has then relied upon massive subventions and/or cost overruns to stay afloat. For example, last June, the World Trade Organization estimated that EADS garnered about $20 billion in illegal subsidies from its European governmental owners.
Then there are EAD’s endemic problems with bribery and corruption. Eleven years ago, with the company’s Airbus sales in mind, former Director of Central Intelligence R. James Woolsey told Europeans in an op-ed in the Wall Street Journal: “Your companies’ products are often more costly, less technologically advanced or both, than your American competitors’. As a result you bribe a lot.”
Frank Gaffney Jr. is the founder and president of the Center for Security Policy and author of War Footing: 10 Steps America Must Take to Prevail in the War for the Free World .
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