Level-Field' Bill Introduced in U.S. Senate

Two U.S. senators are introducing legislation that would require the Pentagon to take into account illegal foreign subsidies in the U.S. Air Force's ongoing tanker procurement saga.
The two senators, Jerry Moran, R-Kan., and Maria Cantwell, D-Wash., said they are proposing the legislation because the World Trade Organization found that EADS, which is the prime contractor for one of the two competing tanker designs, received government subsidies to help fund the development of the Airbus A330. The A330 is the basis of the EADS bid.

"I am proud to introduce this legislation as my first bill in the Senate because I believe when American workers are given a fair chance, they will succeed and produce the best tanker for our men and women in uniform," Moran said in a news release.
The U.S. House of Representatives passed similar legislation in December, 325-23. Moran sponsored that bill before taking office as a senator.
In the Senate, the proposed legislation is co-sponsored by Patty Murray, D-Wash.; Lindsey Graham, R-S.C.; Roy Blunt, R- Mo.; Pat Roberts, R-Kan.; and Claire McCaskill, D-Mo., - a bipartisan group who all represent states where tanker hopeful Boeing has manufacturing plants.
Those factories might help build Boeing's 767-based tanker aircraft should the company emerge as the winner.
Sen. Jeff Sessions, R-Ala., speaking at Senate Armed Services Committee hearing, said that Boeing too has been found to accept illegal government subsidies by the World Trade Organization. Sessions' district in Alabama would benefit from jobs created by an EADS victory in the tanker contest.

Gates, Canadian Defense Minister Defend F-35

OTTAWA - U.S. and Canadian defense chiefs on Jan. 27 vigorously defended the F-35 fighter jet program, despite criticism over costs and technical delays.
Amid a partisan feud in Canada over the government's plans to buy the stealth warplanes, U.S. Defense Secretary Robert Gates said the continued support of Ottawa and seven other international partners for the project was "very important."

"My hope is that for all of our sakes that all of the partners cooperate to move forward with us on this program," Gates told a joint press conference with his Canadian counterpart, Defense Minister Peter MacKay.
The Pentagon sees foreign partners as crucial to keeping costs under control for the radar-evading fighter, which has been dogged by rising costs and technical glitches.
Gates cited steps taken last year to rectify problems with the F-35 and said he was now satisfied with the program's progress, saying there were no cost increases for the program this year.
MacKay accused critics of the plane of playing a political "game" and warned that scrapping the purchase of 65 F-35 fighter jets could mean grounding Canada's air force in 2020.
The F-35 fighter, billed as the backbone of the future U.S. combat air fleet, has become the most expensive weapons program ever and is now expected to cost the United States $382 billion, for 2,443 aircraft.
The two defense chiefs also discussed the war in Afghanistan, where Canada plans to withdraw combat forces from the south in July.
MacKay said Canada was scouting locations near Kabul to host 950 military trainers, as it continues talks with Washington and NATO about what sort of training is required.
Canada plans to send the military trainers to a base in Kabul until 2014 in a non-combat role to advise Afghan soldiers.
Canadian troops have spent nearly nine years fighting insurgents as part of NATO's International Security Assistance Force, a mission that has claimed the lives of more than 150 Canadian soldiers.
The two also said they discussed expanding Canada-U.S. military cooperation in the Arctic and offering joint maritime security assistance to Caribbean allies.
Gates was due to meet both his Canadian and Mexican counterparts but Mexico's secretary of national defense, Gen. Guillermo Galvan Galvan, could not attend due to illness.
An earlier attempt at a three-way meeting of the defense chiefs in July had to be called off because of violence in Mexico.

Italian Air Force Receives 1st Tanker From Boeing

ROME - The Italian Air Force took delivery on Jan. 27 of the first of four Boeing KC767-A tanker aircraft it has acquired.
The aircraft, MM 62229, flew from Boeing's Wichita, Kan., facility to the Italian Air Force's Pratica di Mare base south of Rome for a hand-over ceremony, the Air Force said in a statement.

The aircraft will now "undergo a series of tests and activities" before entering service, the statement said.
"The second aircraft, which should be delivered in the coming months, is now undergoing tests at Boeing," added the statement.
Boeing has previously said that the last two of the four aircraft would feature "enhanced capabilities," without giving details.
The KC767-A replaces the B-707T/T tanker previously flown by the Italian Air Force. It is configured for troop and cargo transport, as well as refueling from a rear boom and three hose and drogues - one under each wing and one under the main fuselage.
Three crew are required for transport flights and four for refueling missions.
After first promising delivery of the tanker in 2005, Boeing's schedule slipped as it sought to fix a vibration problem with a wing pylon, and then tackle a stability problem on the centerline hose and drogue.

USAF: Disclosing Tanker Bid Info Did No Harm

The inadvertent release of confidential information in the competition to build the next aerial refueling tanker didn't hurt the $35 billion project, U.S. Air Force officials told a Senate panel Jan. 27.
The two companies competing to build the KC-X tanker, European Aeronautic Defence and Space and The Boeing Co., received computer discs Nov. 1 from the Air Force containing the military's confidential evaluation of each company's proposal.

Maj. Gen. Wendy Masiello, who works for the assistant secretary of acquisition, told lawmakers on the Senate Armed Services Committee the error was unintentional and didn't violate procurement law.
"The Air Force has been and remains committed to a fair, open and transparent KC-X source selection," Masiello said.
But with the Air Force expected to choose the winner in February, lawmakers worried the error could still hurt the selection process.
"This is a case study of incompetence," said Sen. Claire McCaskill, D-Mo.
Information on each computer disc graded each company on how its tanker might perform. The Air Force was supposed to send each company only that company's evaluations but inadvertently sent the competitor's evaluations, too.
An EADS staffer opened a page evaluating the Boeing plane for an estimated 15 seconds, according to Sean O'Keefe, EADS' CEO. The page didn't include pricing or proprietary information.
The worker alerted security officers and the discs were returned to the Pentagon. The file remained open for three minutes and the computer remained on for 20 minutes, according to Steven Shirley, executive director of the Defense Department's cybercrime center.
"The screen might have been open, but he was the only person in the room and he left the room," Masiello said of the EADS staffer.
O'Keefe disputed reports that EADS held the disc for a month.
"EADS North America acted correctly, quickly and responsibly in addressing an incident that was not of our making," O'Keefe said in a statement to the committee.
Dennis Muilenburg, Boeing's CEO for defense, space and security, said a Boeing staffer noticed a reference to the EADS version of the tanker while opening the disc he received and reported it to security officers without opening the disc.
"Boeing's behavior in this instance is emblematic of our conduct throughout this competition," Muilenburg said in a statement to the committee.
On Nov. 22, Air Force officials decided to make sure the playing field was level and sent each company a page - corresponding to the page the EADS staffer had reported looking at - of the other company's evaluation.
"What kind of actions have been taken against the person who made the mistake?" McCaskill asked Masiello at one point.
Masiello said the two Aeronautical Systems Center workers who sent out the wrong discs were transferred and two others were counseled, but she said she didn't know where the transferred workers are now, whether they earn the same salary or whether they would ever be in a position to deal with contracting again.
Masiello said the company that loses the competition for the tanker contract could use the mistake involving the computer discs as a basis for a formal protest.
Sens. Jeff Sessions, R-Ala., and Roger Wicker, R-Miss., noted that neither company has protested yet.
"It's really important on this committee for us not to politicize this process," Sessions said.

France Offers To Sell Iraq Mirage Fighter Jets

BAGHDAD - France has proposed to sell 18 Mirage fighters to Iraq, which is already negotiating a deal for U.S. F-16s to protect its skies after American forces pull out at the end of this year, the French ambassador said.

France has proposed selling 18 Mirage fighter jets to Iraq. Above, a Mirage 2000 jet fighter takes off from Nancy-Ochey, France. (File photo / Agence France-Presse)

"France has proposed to sell 18 Mirage F1 retrofitted aircraft that can be delivered from late 2011 and immediately operational because many Iraqi pilots were trained in the past on this type of plane," Boris Boillon told Agence France-Presse on Jan. 27.

He said France was offering the multi-role planes for $1 billion (733 million euros).
Baghdad has been negotiating to buy 18 U.S.-made F-16s, and the cabinet on Jan. 26 authorized Prime Minister Nouri al-Maliki to negotiate the terms of the first payment on the contract, a statement said.
Boillon said that, because of the price tag, the Mirage offer would not affect the F-16 deal.
"This [Mirage] sale is in the context of a proposal on a comprehensive military air program that France has submitted to this country," Boillon said.
Iraq's government spokesman said that Baghdad welcomed any offer.
"Iraq needs to build up its Air Force and that needs tens of fighters to protect its sovereignty," Ali-al Dabbagh said.
"Any origin of high quality with good offer will be welcomed taking in consideration that we need to unify the source of arming if they fulfill Iraq's requirements," he said, without disclosing the cost of the F-16 deal.
The Iraqi government "has submitted a letter of request for 18 F-16s and packages composed of spare parts, support equipment, weapons, logistics support and training," said U.S. Army Capt. Dan Churchill, a U.S. military spokesman in Iraq.
"The delivery and cost of the aircraft will be dependent upon a finalized purchase, which has not yet happened."
In early September, U.S. Army Gen. Michael Barbero, then deputy commander of U.S. forces in Iraq, said the absence of a multi-role fighter limited Iraq's air capabilities.
"They will not have the capability to provide air sovereignty, to fully protect the skies over Iraq, because they will lack a multi-role fighter," he said.
Iraq's air force was destroyed during and after the 2003 U.S.-led invasion.

Bulgaria To Sell Off Defense Firm VMZ Sopot

SOFIA, Bulgaria - The Bulgarian government on Jan. 27 said it had agreed to a strategy for the full privatization of defense giant VMZ Sopot.
According to a statement, there will be a public tender of 100 percent of VMZ's capital, with potential buyers required to have previous experience in defense production and management.

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They must also present a three-year business plan for the firm's development under the sale proposal, which still has to be approved by parliament.
Bulgaria's biggest defense firm and the last of the country's communist-era defense giants to have remained state-owned, VMZ Sopot produces a large range of missiles and artillery ammunition, as well as civil-use machinery and household appliances.
A lack of strategic investors in previous defense company tenders has led other state-owned firms to morph into joint-stock companies, owned primarily by their managers and staff.
Bulgaria's defense industry exports stood at 145 million euros ($200 million) in 2009, according to economy ministry data.

German Move Does Not Hurt A400M Program: French MoD

PARIS - The German parliament's decision to back a purchase of 53 A400M aircraft but sell 13 units into the export market keeps the military aircraft program on track but needs to be confirmed by the government, the French Ministry of Defense spokesman said Jan. 27.
"For the time being, this is an internal parliamentary process," spokesman Laurent Teisseire told journalists here. "This is a step, but we are waiting for the formalization by the German executive," he said.

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"What seems very clear is that whatever the expression of the final requirement by the Bundeswehr, seemingly a reduction, the Federal Republic maintains a volume of orders that is coherent, compatible with the volumes agreed with Airbus in the agreement reached last year," Teisseire said.
The German parliamentary budget committee agreed Jan. 26 the government should buy the 53 A400M units, keep 40 and sell on 13 to third parties. This would ease strain on the defense budget and better reflected the real needs of the Bundeswehr armed forces, said Juergen Koppelin, budget expert for the Free Democrat (FDP) junior coalition partners to Chancellor Angela Merkel.
Britain has used a similar approach to buy Eurofighter Typhoon fighters and sell those no longer required by the Royal Air Force.
The German order of 53 aircraft is "important for the existence of the program" as it maintains the total A400M orders at 180 units, with a margin of 10 cancellations, Teisseire said.
That was the framework deal reached in March by Airbus and the seven anchor clients - Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey.
Asked whether there was concern over the sale of the 13 German aircraft into export markets, Teisseire referred to the welcome given by Airbus to the parliamentary decision.
Airbus Chief Executive Tom Enders said Jan. 26, "The decisive point for us is that Germany has agreed on an order of 53 planes, and therefore will take on the additional financing costs of 3.5 billion euros," Reuters reported.
Teisseire also referred to the estimated export market of 400 A400M units cited by the EADS Chief Executive Louis Gallois. EADS is the parent company of Airbus, which builds the A400M.
Thirteen aircraft "does not undermine the fundamentals of the market," Teisseire said, pointing to the long-term prospects for foreign sales.
French Defense Minister Alain Juppé fully supports the A400M program, just as his predecessor Hervé Morin did, Teisseire said. France maintains its order for 50 units, he said.
The A400M is of structural importance to French forces, an industrial project which federates European capacity and provides the capability to project power, Teisseire said. France is one of the first customers of the airlifter.
Germany had previously ordered 60 A400M units but cut that to 53 in November due to costs.
The March agreement, worth 3.5 billion euros ($4.8 billion), was needed because the A400M is three years late and Airbus demanded extra funds to cover the 5.25 billion euros of overrun.
The A400M, dubbed Grizzly, is in test flight, with four prototypes flying. First delivery is due in the first half of 2013. The plane is intended to contest the market for military transport planes held by Boeing and Lockheed Martin.