Tanker news: Defense bill ensures subsidies review

Published 4:12 pm Wednesday, September 24, 2008

Update: Rep. Norm Dicks, D-Wash., says new language in the defense authorization bill approved today ensures that the Department of Defense will review subsidies when awarding the Air Force tanker contest.

“While political pressure from Senator John McCain eliminated all concerns over illegal subsidies from the prior tanker competition, it will be much harder to argue that case if the WTO ruling contains the acknowledgement – which we expect — that Airbus launch subsidies are not compliant with WTO agreements on large civil aircraft,” Dicks said, in a statement.

You can read more about the subsidies language here.

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The Pentagon may have scrapped the lucrative tanker contract earlier this month, but that doesn’t mean the tanker waters in Washington are calm.

Alabama Sen. Richard Shelby wrote this editorial published Monday (yes, I’m a little behind on tanker news). In it, Shelby essentially says the contest was slanted in Boeing’s favor and against Northrop-EADS, who would have built their tanker in Shelby’s state.

From Shelby’s op-ed:

Politics just cancelled a competitively awarded contract, solely because Boeing was not the winner. Defense acquisition policy has been stated: If it is not a Boeing plane, DoD is not going to buy it. …

Terminating the tanker competition sent a clear message – that competition is fine, as long as Boeing wins. The secretary of defense made the wrong decision, and he made it for the wrong reason.

Yesterday, DoD Buzz posted this story about Sen. Maria Cantwell, D-Wash., and the tanker.

Back in June, Cantwell told Boeing Machinists in Everett that she would block the nomination of acting Air Force Secretary Michael Donley if the Pentagon didn’t rebid the tanker contract after government auditors recommended doing so.

“We’re not going to allow another secretary of the Air Force” to be confirmed, “unless they say they’ll rebid,” Cantwell said in June. “We have to go back now and hold their feet to the fire.”

In August, Cantwell showed she meant business by officially putting a hold on Donley’s nomination.

Even though the contract will be rebid under a new administration, Cantwell intends to continue to block Donley’s nomination until the Pentagon hands over some classified documents she requested on the tanker competition, according to the Tuesday report.