Defense Science Board: Tanker competition is perverted

One example of the perversion of current globalization policy is the United States Air Force (USAF) tanker competition. The Boeing 767 facility must be ITAR compliant, regarding business access and US employees, so that the aircraft can be sold to the military. The Boeing 767 also required a Berry Amendment waiver, because large shares of its parts are developed offshore, including parts that are manufactured in Russia. By Contrast, the Airbus KC-30 is exempted from the Berry Amendment because the law exempts production from certain allied nations.

REP.\nTIAHRT: You are waiving the regulations for the Europeans, by the way you just\nexplained it to me. And in doing so you've created an unlevel playing field and\nan unfair advantage to one bidder over the other.

Ninety\npercent of the product is built in Europe, and\nthey don't have to comply with five specific regulations -- the cost accounting\nstandards, the Foreign Corrupt Practices Act, the International Trafficking in\nArms Regulations, the Berry Amendment, and the Buy American Provisions. Those\nare the five regulations that have been waived by the Department of Defense --\nnot Congress, by you guys. Are you going to force them to comply with them just\nlike you do the American company? Because if you don't American workers are put\nat a disadvantage.

MR. YOUNG:\nBoth bidders, both companies must comply with all the regulations and laws you\njust cited. Both of those bidders are reaching outside of their defense company\nheadquarters to get commercial products. Both of those commercial product\nproviders are not subject to some elements of all of those regulations you\ntalked about.

But all the\ncommercial products are subject to the same regulations and then the defense\ncompanies that are bringing those commercial products into and modifying them\nto deliver the U.S.\ngovernment a tanker are fully subject to all the regulations. And we will not\nbe waiving regulations with regard -- (inaudible).

REP.\nTIAHRT: You will not apply these five regulations to 90 percent of one of the\ntwo bids. That's just what you've told me. You said the American portion --\nwell, fine. We'll apply the regulations equally for 10 percent of the product.\nBut for 90 percent, we're going to make a disadvantage for American workers\nhere by allowing no cost accounting standards, no Foreign Corrupt Practices\nAct, no International Trafficking in Arms regulations. Those are very expensive\nregulations to implement, and you're -- (audio break) -- implemented entirely\non one body and you're waiving it entirely for 90 percent of another body. That\nis an unfair advantage.

MR. YOUNG:\nWe're implementing it uniformly to the two bidders.