[Congressional Record (Bound Edition), Volume 154 (2008), Part 3]
[Senate]
[Pages 3022-3024]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              BOEING LOSES

  Ms. CANTWELL. Mr. President, I rise to join my colleagues, the senior 
Senator from Washington, Mrs. Murray, who did an eloquent job talking 
about the shocking news that came out last Friday about the Air Force's 
decision to go with the KC-30 tanker over the Boeing KC-767 plane. I 
know my colleagues from Kansas want to continue this dialog as well.
  What we see is a lot of concern and questions that have not been 
answered by the Air Force. I appreciate the fact that Speaker Pelosi 
also issued a statement today questioning the decision by the Air Force 
and asking for further congressional review. That is why my colleagues 
are here this morning. We want answers from the Air Force. Frankly, we 
don't want to wait another week to get them. For 75 years, Boeing has 
been making tanker products. They know what they are doing. They 
submitted a bid to the Air Force for a more flexible plane with a cost-
effective life cycle. It has proven boom technology. This technology is 
used to refuel aircraft for the militaries all over the world. Other 
governments have already bought this product and have made the decision 
to use this technology. It is amazing to my colleagues and me that the 
Air Force would make this decision about these planes based one bid 
that is a proven technology and has proven successful for more than 70 
years and all of a sudden switch to a product that has yet to be built 
and yet to be proven. The Air Force has made assertions and assumptions 
without giving Congress the answers.
  What I am really amazed about, frankly, is that we are seeing some of 
the highest fuel costs in America and that impacts our Air Force as 
well and I want to know why the Air Force picked such a large plane, 
when their specs clearly asked for a medium-sized plane. If the Air 
Force wanted a large plane, the Air Force should have simply asked for 
a large plane. The Boeing Company could have provided a 777 instead of 
the 767. But that is not what the Air Force asked. I take the Air Force 
at its word when they say they want to be more energy efficient. In 
fact, the Air Force uses more than half of all the fuel the U.S. 
Government consumes each year. Aviation fuel accounts for more than 80 
percent of the Air Force's total energy bill. In 2006, they spent more 
than $5.8 billion for almost 2.6 billion gallons of jet fuel, more than 
twice what they spent in 2003.
  If anybody thinks fuel costs are somehow magically going to come 
down, they are not. The Air Force needs to consider the impact of fuel 
costs in the future. In fact, I believe it is a national security 
concern as to where the Air Force is going to get fuel in the future.
  Just last Friday, the Air Force Assistant Secretary told the House 
Armed Services Committee that it wants to leave a greener footprint 
with more environmentally sound energy resources. Well, if the Air 
Force is coming up to Capitol Hill talking about a greener, more fuel-
efficient plane and at the same time awarding a contract for a plane 
that burns 24 percent more fuel than the Boeing KC-767, they do not 
have their act together.
  This is what Assistant Secretary Bill Anderson said:

       The increasing costs of energy and the nation's commitment 
     to reducing its dependence on foreign oil have led to the 
     development of the Air Force energy strategy--to reduce 
     demand, increase supply and change the culture within the Air 
     Force so that energy is a consideration in everything we do.

  Well, I certainly want to know what consideration the Air Force gave 
to this new energy mandate in their decision to go with the KC-30 over 
the KC-767, when the Boeing plane is 24 percent more fuel efficient.
  Now, one of the things the Air Force stressed in the contract 
announcement was the size of the KC-30. It is a slightly bigger plane, 
and the Air Force claims to want that larger plane because it can carry 
more fuel. However, that fuel is going to cost us.
  Since the Vietnam war, the average amount of fuel offloaded from 
these air tankers is 70,000 pounds. When these tankers are out 
refueling planes the average amount of fuel they need to carry to 
complete a mission is less than 70,000 pounds, and that is during 
combat operations when they are very busy, which obviously would be 
less during in peacetime operations. This begs the question: Why did 
the Air Force choose a foreign-built tanker that has the capacity to 
carry 245,000 pounds of fuel versus the right-sized plane from Boeing 
that carries 205,000 pounds of fuel? Why did they choose a plane they 
know is going to have more expensive life cycle costs and more 
expensive on fuel costs, instead of buying the right sized plane? That 
would be like driving a humvee to the Capitol every day when you could 
drive a more fuel-efficient car. The Air Force has to live up to their 
commitment to a greener energy strategy.
  The second issue that is troubling to me is the fact that there is an 
issue about runway, ramp, and infrastructure capacity. The KC-767 
tanker is a smaller plane, it has ability to land on many more 
airstrips we have access to around the world. The Boeing tanker can 
land on shorter runways, takes up less ramp space, and altogether needs 
less infrastructure. The KC-767 can operate at over 1,000 bases and 
airstrips worldwide.
  For example, at a strategic central Asian airbase in Manas, 
Kyrgyzstan that I think is key to the war on terrorism, the current 
runway cannot support the KC-30 plane. It cannot support the plane the 
Air Force just selected. However, it can support the KC-767 that Boeing 
offered. Again, it begs the question: why did the Air Force would 
choose a larger plane when it knows it is going to be unable to land at 
many bases and airstrips? Are we going to have to pay for the cost of 
infrastructure improvements of that as well?
  It is very important, given these fuel issues and these 
infrastructure issues, that the Air Force prove to Congress that the 
cost-effectiveness throughout the life cycle of this procurement really 
does pan out. If we are simply talking about buying cheaper planes up 
front, but the life-cycle cost of these planes turns out to be 
exorbitant--because the fuel is more expensive, because the plane 
cannot land at various bases--and you have to spend billions more on 
both of those things, that is very troubling.
  The reason this is so troubling to me is because I have seen this 
same issue play out in the commercial marketplace. Airbus planes have 
been backed by government financing in the commercial markets, so they 
were able to put a cheaper plane out in front of many governments 
across the globe. Boeing, on the other hand, has proven with technology 
to have more fuel-efficient planes, and they were able to show people 
that the true life cycle costs of their planes were actually more cost 
effective. The end result is a WTO dispute over the financing of Airbus 
by government-backed operations.
  What I am trying to say is that the private sector has figured it 
out. In the commercial space, fuel-efficient planes are paying their 
way. I wonder why the Air Force did not figure out the same scenario 
and did not figure out that they will save U.S. taxpayers' dollars by 
having a more fuel-efficient plane. I also ask the Air Force to explain 
when

[[Page 3023]]

the Boeing tanker is 22 percent cheaper to maintain because of the 
flexibility advantages it has.
  I have concerns that Boeing worked hard to meet the requirements the 
Air Force set. The 767 platform best matched what the Air Force wanted. 
If they wanted a bigger plane with more capacity, they simply could 
have asked for one. Yet here we are with a questionable decision that I 
think raises concerns about the ability of the Department of Defense to 
maintain critical skills. We need to make sure there is a homegrown 
workforce and engineers to deliver products we need.
  The U.S. Government needs to consider the national security 
implications of fuel efficiency in this procurement decision. It needs 
to take a look at the U.S. workforce and determine whether the loss of 
high-skill manufacturing jobs is impacting our national security. I 
plan to ask the Government Accountability Office to investigate these 
issues and report back to Congress so we can have a full debate and 
move ahead.
  I will remind the Air Force that in the conclusion of their testimony 
last week before Congress, they stated: We will continue to wisely 
invest in our precious military construction and operations and 
maintenance. They highlighted energy as the key element wise 
investment. I think the Air Force has a lot of explaining to do, and I 
want to know why they have made this choice. I guarantee you that 
Congress will continue to ask the tough questions until the information 
is clear to everyone in America.
  Mr. President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The majority's time has expired.
  The Senator from Kansas.
  Mr. BROWNBACK. Mr. President, I ask unanimous consent to speak in 
morning business for up to 10 minutes.
  The ACTING PRESIDENT pro tempore. Is there objection?
  Hearing none, it is so ordered.
  Mr. BROWNBACK. Mr. President, thank you very much.
  I thank my colleagues. I, too, am from a State that is keenly 
impacted by what is taking place on this bid proposal. The Air Force's 
decision to award a new tanker contract last week is a crowning 
achievement, not for the Air Force or the United States but for Airbus 
and the Europeans.
  We were saying in our office, I wonder if in the future our young men 
and women going into the Air Force to fly these planes or to work on 
these planes are going to have to pass a test in French--``Parlez-vous 
francais?''--to be able to determine whether we can work on these 
aircraft. And to be able to get maintenance, equipment, and training, 
well, we are going to have to go to Europe to be able to do that. We 
are going to have to get the people who built them to tell us how to do 
it. I do not think that is right.
  I also would like to say to my colleagues, I have been around this 
fight between Airbus and Boeing for a long time, and Airbus has 
subsidized itself directly into the commercial aviation market. They 
had zero market share 30 years ago. They started a European consortium 
called Airbus and EADS to be able to get at Boeing and into the 
commercial aviation market. They completely subsidized their way into 
it. It got to a point with the subsidies where they were taking over 
half of the marketplace in commercial aviation. Now here we go again. 
We are just now on the defense side of it. Instead of the commercial 
side, we are on the defense side.
  This aircraft which EADS and Airbus have put together is heavily 
subsidized by European governments, by European treasuries, to be able 
to get a price point, to be able to compete against a well-known Boeing 
aircraft that has been in our fleet for decades, that has worked well 
for decades, that has been used to train our young pilots and multiple 
generations of pilots on this tanker. Now we are going to put those 
pilots in an Airbus plane, and they are going to land in fields all 
over the world in an Airbus airplane--our U.S. military risking life 
and limb--while the Europeans make money off of us and get into, by 
subsidization, a defense marketplace.
  Make no mistake, this is just a start. This is what the Europeans did 
in commercial aviation. They started subsidizing commercial aviation. 
They got in one place, got all the market share, and subsidized into 
another one.
  They do things called launch aid. I don't know, my colleagues 
probably are not familiar with launch aid, but launch aid is where 
European governments say: We will give you this much money to start 
this aircraft, and if you stop producing this aircraft, then you have 
to pay the money back. Well, it then pays them to keep producing the 
aircraft, and even selling it at a loss, because then they do not have 
to pay the launch aid back.
  Well, now they are doing it in a defense contract field, and they 
start with tankers. The Europeans start with tankers. Then they will go 
with surveillance aircraft. Then they will move to other airframes, to 
where then is it going to be all of our major airframes that are going 
to be made by the Europeans?
  I like the comment from my colleague from the State of Washington: 
What happens if the Europeans are not pleased with what we are doing in 
the war on terrorism or what we are doing in the defense of Israel and 
if then their governments start saying: Well, I don't like what your 
policy is in the Middle East. Now, as you know, what they do is they 
say: Well, we are not going to give you overflight rights. We are not 
going to let you fly your planes out of Germany or not let you fly your 
planes out of Great Britain. We are going to stop you.
  What if in the future they start saying: We are not going to sell you 
spare parts. Then where are we at that point in time? What do we say to 
them? I do not know how to use my French enough to plead and beg for 
spare parts, but I really do not want to be in that spot, and I do not 
think we should.
  As a friend of mine said to me this morning--he is for a very open 
trading system--he said: There are two things we should not be 
dependent upon other governments for: one is for your defense, and one 
is for your food. Those are just two things you should not be dependent 
upon another government for. Now we are going to be dependent for our 
defense on a European government that often goes a different way than 
us. I think this is crazy. For a decision that is going to last--as my 
colleague, my seatmate from Kansas, said--for up to 80 years, that just 
does not seem to be a smart way to go.
  This is one Senator who is going to fight against this, who is going 
to fight against this in the appropriations process. I do not think it 
is smart. I think it is the wrong thing to do.
  Mr. ROBERTS. Mr. President, will my colleague and friend yield for a 
question?
  Mr. BROWNBACK. Yes, I will.
  Mr. ROBERTS. I say to the Senator, you brought something up that I 
think is very important. As you look at the various countries that form 
up EADS and Airbus and that will participate in this joint effort, 
which is subsidized, even though we have a WTO case against them, what 
happens if these countries do not agree, as the Senator has pointed 
out, with our appropriate policy in regard to the war against terrorism 
or any other endeavor?
  The example I would like to make is: Look at the amount of money 
these countries, in their gross domestic product, give to defense. The 
answer is almost zero. Look at the amount of investment they give to 
NATO, where we are now fighting al-Qaida in Afghanistan. A few 
countries will fight with us. Note the word I said: ``fight.'' As to 
other countries that are now receiving this contract, despite the fact 
they are subsidizing their own product, they are not fighting in 
Afghanistan. They are not contributing to NATO in a positive way. Some 
of them are there, but they do not enter into the battle.
  Now, here we are, with the American taxpayer paying for the security 
of Europe and Europe really not facing up to the task of funding and 
participating in NATO to the extent they can. Yet, in regard to our 
national security with this particular purchase--and if you do not have 
tankers, you do not have global reach, you cannot go anywhere, you have 
access denial, and you cannot even fight the war in regard to 
Afghanistan or any future place. Yet they are

[[Page 3024]]

absent without leave, they are not even there. So I think my friend has 
made an excellent point and I thank him for his comments. We are going 
to join in an effort to see what can be done because this is harmful 
not only in regards to workers in France, vis-a-vis these workers in 
America, but it involves our national security.
  I think my colleague and my friend from Kansas has made an excellent 
point.
  Mr. BROWNBACK. I appreciate my colleague joining with me. I wish to 
make two other quick points. One is I think we need a long-term 
economic model of the impact on our economy versus the impact on the 
European economy. Because I believe if you look at the true cost and if 
you look at the true impact of these jobs being in the United States 
versus subsidized jobs in Europe, you are going to see the long-term 
economic impact on this country and on our Government with the taxes 
our workers would pay will be better by building the plane here.
  Second--and this is a strategic issue--this is a bigger plane that is 
being purchased by the military. It is going to need a longer landing 
strip. Are those longer landing strips going to be available in 
countries such as Azerbaijan or Kazakhstan or are we going to be able 
to get a longer runway to be able to land on? Now we have a plane that 
will carry more fuel, but it will take a longer landing strip. We can 
build those in the United States. We can build bigger hangars here. Can 
we around the world so we can have the reach we need?
  Mrs. MURRAY. Mr. President, will the Senator from Kansas yield for a 
question?
  Mr. BROWNBACK. I am happy to yield.
  Mrs. MURRAY. I am listening to the Senator from Kansas, and he makes 
a very good point about the infrastructure that will be needed to be 
built to build these larger airplanes. Was any of the cost of building 
those runways or those hangars to accommodate the larger airplanes in 
part of the bid from Airbus?
  Mr. BROWNBACK. I understand from the Air Force yesterday that some of 
it was, but I don't understand if it was--I do not know fully if it was 
just the U.S. cost or if it is also what we are going to have to get 
from other countries around the world on costs there for landing, 
longer landing strips, and bigger hangars to be able to put any of the 
aircraft in. So I don't know if that is fully in it as well. But these 
are huge, decade-long projects and costs.
  Mrs. MURRAY. I thank the Senator. I think it is a point we have to 
look at in terms of the costs of providing this military contract to a 
subsidized foreign company as well as the future costs--not just for 
those airplanes but for the infrastructure to handle it and our 
capability of doing that.
  Mr. BROWNBACK. Mr. President, we have just started this discussion, 
and I think it is a big one, I think it is an important one, whether we 
should be dependent upon European governments for our global reach in 
military for our aircraft. That is what tankers provide us is a global 
reach and whether we should be dependent on the European governments--
upon the French, upon the Germans, upon the Brits--for our global 
reach. I don't think we should be. I think we have to look at the 
subsidization of this cost by the Europeans. I think that needs to be 
discounted and taken out of this proposal. I think we have to look at a 
long-term project, and we are going to be talking about this a lot 
before we go forward with this--as Chancellor Merkel called it, this 
giant success for Airbus and the European aviation industry. It may 
have been that it is at our cost. I am not going to stand still and let 
it happen.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from New Hampshire is 
recognized.
  Mr. GREGG. Mr. President, what is the regular business? Are we in 
morning business? Do we have a half hour?
  The ACTING PRESIDENT pro tempore. We are in morning business and the 
Senator has a half hour.

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