Published: Tuesday, June 29, 2010
IN OUR VIEW / AIR FORCE TANKER DEAL
Can't ignore illegal subsidies
Bipartisanship, it turns out, is still possible on Capitol Hill — when a clearly sensible idea comes forth.
The House late last month passed an amendment to the 2011 National Defense Authorization Act, by a vote of 410-8, to require the Pentagon to consider “any unfair competitive advantage” held by a bidder for the Air Force refueling tanker contract. Washington Democrats Jay Inslee and Rick Larsen were among its six co-sponsors, a group that included two Republicans.
The Senate could vote on the amendment after its Fourth of July recess. Washington Democrat Patty Murray and Kansas Republican Sam Brownback are co-sponsors in that chamber.
The lopsided vote in the House reflects Congress' ability to grasp the obvious. The Boeing Co. is competing with the European consortium EADS, which owns Airbus, for the $35 billion tanker deal. The platform for the EADS entry is the Airbus A330, which the World Trade Organization said in a preliminary ruling had received illegal subsidies. Without illegal launch aid, in the form of loan guarantees that all but eliminated risk for the company, it's arguable that the A330 would never have made it to the assembly line.
Boeing's entry, the Everett-built 767, was created the old-fashioned way: at the risk of the company and its shareholders.
The WTO is expected to issue its final report on the Airbus ruling on Wednesday. That should give the Senate any final push it needs to approve the House amendment.
The Pentagon has signaled repeatedly that it has no appetite for getting into the middle of a trade dispute, saying it would not consider the WTO ruling in its tanker deliberations.
Congress, which answers more directly to voters, knows an untenable situation when it sees one.
It's easy enough to argue that sending a $35 billion military contract to a foreign company, when a reliable, proven U.S. firm is in the mix, is absurd on its face. OK, so America is all about open competition, even though trade rules don't require it for defense contracts. Fine.
But it's also worth pointing out that the U.S. economy is in a world of hurt, and that the government has spent hundreds of billions to stimulate demand and create jobs. Against that backdrop, paying $35 billion to an overseas contractor won't go over well at home.
Add the obviously unfair advantage illegal subsidies have given Airbus in this process, and Congress had to act. Too much is at stake — for our fighting forces and our economy.
The Defense Department is part of the U.S. government, funded by U.S. taxpayers. It's not Switzerland. It can't be allowed to remain neutral on this critical point.
The House late last month passed an amendment to the 2011 National Defense Authorization Act, by a vote of 410-8, to require the Pentagon to consider “any unfair competitive advantage” held by a bidder for the Air Force refueling tanker contract. Washington Democrats Jay Inslee and Rick Larsen were among its six co-sponsors, a group that included two Republicans.
The Senate could vote on the amendment after its Fourth of July recess. Washington Democrat Patty Murray and Kansas Republican Sam Brownback are co-sponsors in that chamber.
The lopsided vote in the House reflects Congress' ability to grasp the obvious. The Boeing Co. is competing with the European consortium EADS, which owns Airbus, for the $35 billion tanker deal. The platform for the EADS entry is the Airbus A330, which the World Trade Organization said in a preliminary ruling had received illegal subsidies. Without illegal launch aid, in the form of loan guarantees that all but eliminated risk for the company, it's arguable that the A330 would never have made it to the assembly line.
Boeing's entry, the Everett-built 767, was created the old-fashioned way: at the risk of the company and its shareholders.
The WTO is expected to issue its final report on the Airbus ruling on Wednesday. That should give the Senate any final push it needs to approve the House amendment.
The Pentagon has signaled repeatedly that it has no appetite for getting into the middle of a trade dispute, saying it would not consider the WTO ruling in its tanker deliberations.
Congress, which answers more directly to voters, knows an untenable situation when it sees one.
It's easy enough to argue that sending a $35 billion military contract to a foreign company, when a reliable, proven U.S. firm is in the mix, is absurd on its face. OK, so America is all about open competition, even though trade rules don't require it for defense contracts. Fine.
But it's also worth pointing out that the U.S. economy is in a world of hurt, and that the government has spent hundreds of billions to stimulate demand and create jobs. Against that backdrop, paying $35 billion to an overseas contractor won't go over well at home.
Add the obviously unfair advantage illegal subsidies have given Airbus in this process, and Congress had to act. Too much is at stake — for our fighting forces and our economy.
The Defense Department is part of the U.S. government, funded by U.S. taxpayers. It's not Switzerland. It can't be allowed to remain neutral on this critical point.
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