The Swine Line

CCAGW Statement Submitted for the Record before the House Armed Services Committee

Committee Mark-Up of H.R. 5658, The National Defense Authorization Act for Fiscal Year 2009

May 14, 2008

According to the May 2 Congressional Quarterly, some members of the House Armed Services Committee are considering challenging the Air Force’s $35 billion contract award to Northrop Grumman for its new generation of refueling tankers to force a reopening of bids. Currently, the Government Accountability Office (GAO) is undertaking a review of the contract award process in response to Boeing’s protest. The GAO has until June 19 to issue its decision. On behalf of the more than 1.2 million members and supporters of the Council for Citizens Against Government Waste (CCAGW), the committee should oppose any efforts to scuttle the Air Force’s tanker contract while the GAO is undertaking its review.

CCAGW has been interested in the Air Force refueling tanker debate ever since a $3,000,000 earmark was inserted into the fiscal 2003 Defense Appropriations Act for the no-bid tanker lease program. The earmark won the CCAGW 2003 Congressional Pig Book Oinker, “The Taxpayers Get Tanked Award.” Taxpayers remember that this project became one of the worst examples of corporate welfare and eventually ballooned into a major scandal. The Air Force’s chief negotiator on the tanker contract and Boeing’s number-two corporate officer went to jail and Boeing was fined more than $600 million.

The Air Force undertook a competitive bid process in 2006 and two companies, Boeing and Northrop Grumman, submitted proposals. Just before the announcement of the contract winner in 2008, both sides stated that the competition had been fair and transparent. But on February 29, 2008, the Air Force awarded the contract to Northrop Grumman and suddenly the political environment changed in Washington, D.C. Now supporters of Boeing have accused the Air Force of using unreliable foreign suppliers to build the tanker, have expressed angst that jobs would go overseas, and argued that national security would be compromised. They continue to ignore the fact that Boeing’s planes contain foreign parts, including some manufactured in China and Japan. The Northrop Grumman plane, in partnership with the European Aeronautic Defence and Space Company, will be built in Alabama and security issues will be handled by the Defense Department inside Northrop Grumman facilities.

CCAGW believes that Congressional interference with the tanker acquisition process sets a bad example. Under Secretary of Defense for Acquisition, Technology, and Logistics John Young said in an April 18, Seattle Post Intelligencer article that actions by some House members to simply override the Air Force’s decision “would open up slippery slopes and dangerous precedents.” He pointed out that if lawmakers are successful in obstructing funding for the tanker contract that was won by Northrop Grumman, it would create serious problems and more Congressional interference in federal contracting. Young stated, “Do we have the California delegation kill a program because the Georgia delegation won? I don’t know where this stops.” We agree with Young’s statement, “If I am going to demand that certain companies or proposals must win regardless of what they cost, I am going to disadvantage the taxpayer and war fighter. I am going to deliver (a weapon with) less capability for more cost.”

On April 21, while speaking at the Air War College in Maxwell, Alabama, Defense Secretary Robert Gates said, “All I can say is that I think it would be a real shame if the tankers were to get delayed. We are long past due in terms of getting on with this program.” Secretary Gates added, “Based on everything I’ve seen this was a fair process but we’ll wait and see what the GAO report says.”

The House Armed Services Committee should follow Secretary Gates’ advice and oppose any efforts to reverse or stop the tanker contract before the GAO issues its report. Furthermore, if the GAO delivers a clean bill of health for the process, members of Congress should abandon further efforts to overturn the Air Force’s contract award.