Them’s fightin’ words … Aboulafia vs. McCain




From Aboulafia’s blog last week:

“We know that McCain influenced the tanker selection processagainst Boeing with multiple letters to Deputy SecDef Gordon England andSecDef Robert Gates. We also know that McCain, for good and/or bad reasons,stopped the original Boeing tanker lease deal from going ahead. We know thatpeople in McCain’s office have also worked as EADS lobbyists. At least onelobbied for EADS while working for McCain. Finally, we have the GAO document, whichaccuses the Air Force of favoritism and bias, yet doesn’t cite any rationale ormotive for this bias. There’s really just one.

So far, no one has been able to connect these four datapoints and prove that McCain and his lobbyist associates pushed the Air Forceinto actively favoring the Northrop/EADS plane. McCain’s office has veryskillfully maintained plausible deniability.”

That’s a very remarkable — and politically explosive — analysis. Aboulafia appears to be asking: 1) Did McCain steer the KC-X contract requirements to favor Northrop Grumman’s bid, and 2) Were McCain’s actions improperly influenced by EADS lobbyists?

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14 Responses to Them’s fightin’ words … Aboulafia vs. McCain

  1. Scott Ferrin 30 June, 2008 at 6:21 pm #

    Killing the tanker lease program was a no-brainer, especially after it came out that Boeing paid people off to try to run it through.

  2. Stephen Trimble 30 June, 2008 at 6:39 pm #

    Darleen Druyun admitted to favoring Boeing on several programs, not just the tanker.

    It is worth noting two facts. Number 1: If McCain had not blocked the lease deal, the USAF would have 100 KC-767s in-service by next year. Number 2: The aircraft would be leased at a rate of $125 million per airframe, or almost $55 million less than the procurement cost per aircraft negotiated in the latest deal. As far as sweetheart deals go, that one wasn’t so bad.

    I’ve always felt that it was really what Druyun did for Boeing on the other programs — ie, C-130 AMP, Small Diameter Bomb, EELV — was far more egregious than the tanker deal. In those examples, she intervened to deprive Lockheed of contracts they had rightfully won and gave them to Boeing for spurious reasons.

  3. Stephen Trimble 1 July, 2008 at 4:27 am #

    Okay, you are technically correct. The upfront lease cost was estimated at $125 million per aircraft, but when you add the cost of the training, support and buy-back, the overall cost rises to the $24 billion figure. (I think the CBO actually estimated it at $26 billion, while the USAF estimated it at $18 billion, generously assuming the approval of a multi-year procurement.) If you compare the same apples-for-apples costs with the latest tanker deal, you’d probably have to substantially increase the roughly $175 million estimated price tag per aircraft (although I admit I’ve never tried to calculate it.) So, even accepting your point, I still argue that might point stands. I’m not defending the lease deal. It was deservedly discredited and clearly the USAF’s intentions were not in the taxpayer’s best interests. Aboulafia’s points that some of the lease deal’s critics also may not have had pure motives also deserves some investigation, too.

  4. Thomas Bambrick 1 July, 2008 at 10:24 am #

    That does bring some interesting things up front.

    but with the tanker deal McCain is right like Boeing were really getting a sweet deal on that.

    but the competition was really biased towards EADS by all accounts so would be interesting to know if McCain did have any input into the whole debacle.

    And if he did i think we can saftely say what the new air force 1 will be

  5. Stephen Trimble 1 July, 2008 at 12:08 pm #

    The one question I have about Aboulafia’s point is where he says the GAO is accusing the USAF showing bias towards Northrop Grumman/EADS.

    That’s obviously true in regards to the decision, but I don’t see where that happened in the competitive phase. Indeed, it seems to me that GAO’s point was that the USAF awarded the contract to Northrop even though the contract requirements tilted toward the KC-767.

    Richard, if you’re reading, can you clarify?

  6. Royce 1 July, 2008 at 1:58 pm #

    I think he was basing the bias on the point from the GAO stating that the USAF had misled Boeing about meeting performance parameter and not giving them a chance to address the issue.

  7. Stephen Trimble 1 July, 2008 at 2:14 pm #

    I see what you mean. I guess the question then becomes was that omission caused by negligence or something intentional. That goes straight to the motive issue. And, as Aboulafia says, the GAO report is silent on the USAF’s motives. We’re getting somewhere now!

  8. Reheat 15 July, 2008 at 2:52 am #

    This is unpatriotic. As a US taxpayer I feel strongly that the US government should support US businesses. If McCain was involved in biasing the outcome he clearly did not work in US interests and should step down as the republican presidential candidate.

  9. Marvel 52 15 July, 2008 at 9:50 pm #

    Omigawd, Reheat, that Buy American nonsense again! We are not living in Teddy Roosevelt times, Sir! The old truth says that you seldom buy weapons based on their performance/economy etc. – it is always politics or economic interests veiled in politics. So you mean Europeans should follow the example and buy worse machines just because they are European? You have missed the century, sorry to say.

  10. Scott 17 July, 2008 at 4:10 am #

    I agree that the original Boeing tanker lease was a little too much of a sweetheart deal, but even conceding that one point, the rest of Aboulafia’s argument against McCain is very persuasive:
    Prior to the surprise award to Northrop/EADS, almost all the analysis I read concluded that the KC-45 was too large from RFP requested and what the Air Force needed. In fact EADS conceded that point by talking-up the “dual use” capability of the KC-45, even though there weren’t any requirements in the RFP about dual use. McCain’s letters weren’t some generic request for fairness, but instead specifically requested that the Air Force consider the dual use capability of both aircraft, which clearly favored EADS. Why would he make such a request? I can see why he would request that the process be fair and that taxpayers get the best value, but interfering with specific RFP requirements is outside his responsibilities and knowledge. It looks especially bad because his interference was so clearly tilted toward EADS. Given how people had been fired (and jailed) from McCains’s previous involvement, they took notice and cowardly cow towed to McCain’s request; included dual use in their consideration and awarding the contract to EADS. As much as I like McCain, this looks really bad. But probably only really noticeable to those of us that have followed this tanker award closely.

  11. Stephen Trimble 17 July, 2008 at 8:39 am #

    You make a good case, but isn’t also at least possible that the USAF simply changed its mind? Keep in mind that the way they structured the original source evaluation actually should have tilted the result to Boeing, since offering more fuel offload wasn’t officially given credit. I remember Northrop seriously considered not bidding in January 2006 because of the way it was written. Somewhere along the way, the USAF changed its mind, but didn’t change the evaluation criteria.

  12. Scott 17 July, 2008 at 8:24 pm #

    ””You make a good case, but isn’t also at least possible that the USAF simply changed its mind?”””

    Clearly the Air Force did change its mind, but for what reasons? And why not be clear to the bidders as to why the change was made. That’s what stinks about their process. After years of preparing the voluminous requirements, they decide to make a change in a major requirement during the last month or two, and the change is clearly toward EADs, and without that change EADs would have been sunk. We don’t know exactly when the change occurred, but it was clearly after John McClain’s written request to change it. it looks awful, and as much as I hade beat up on McCain it looks like he unfairly influenced the deal toward EADs.

    On another note, EADs has no chance to make their delivery date to the Air Force. They have not even broken ground in Alabama. Their delivery dates are a fantasy, and given how terribly late this decision has been made, combined with the decrepit state of the current tankers, the Air Force has to get realistic about which vendor can really meet the delivery date.

  13. S 19 July, 2008 at 3:23 am #

    Aboulafia rooting for the Boeing tanker to get the USAF order? Shock horror, i never could have imagined that(not)

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