Hard Day on the Hill

If Air Force Secretary Michael Wynne and the service’s Chief of Staff, General Michael Moseley, looked a little haggard yesterday, they had good reason.

Both appeared on Capitol Hill and faced withering criticism over the Air Force’s decision to award its new tanker contract to Northrop-Grumman, and its European partner EADS. Supporters of the losing bid (offered by Boeing), were out in full force, and they quickly jumped on Mr. Wynne and General Moseley.

“I ... feel like I was personally misled,” said Rep. Norman Dicks, D-Wash., whose home state would gain jobs from a Boeing victory. “I think the Congress was misled, this committee was misled, the Boeing Co. was misled. ... You’ve got to go back and start over.”

As Erik Holmes of Air Force Times noted, the hearing was supposed to cover the Air Force budget for Fiscal Year 2009. But, rancor over the tanker decision literally “sucked most of the air out of the room” and put service leaders on the defensive.

Dicks alleged that the Air Force continued to change its evaluation criteria to favor a larger airplane, which would favor the Northrop/EADS tanker, a version of the commercial Airbus 330, over the Boeing proposal, a version of the smaller 767 jetliner. He said the Air Force indicated throughout the process that it preferred a medium-sized aircraft over a large one, only to choose the large airplane at the last minute.

Wynne responded that size was never an explicit criterion in the Air Force’s request for proposals, and Boeing had been welcome to put forward its larger 777 but did not.

Another Boeing supporter, Kansas Republican Todd Tiahrt, accused the Air Force of disregarding the impact of its decision on the U.S. economy and American jobs:

“You had two competitors, but they were not on equal footing,” Tiahrt said. “It was not a fair competition. The deck was stacked against the American supplier and against American workers.”

While Wynne and Moseley caught heat from Boeing’s Congressional supporters, the aerospace giant filed a formal protest with the Government Accountability Office. claiming that the service manipulated data in the tanker competition.

In its formal protest, Boeing essentially accused the Air Force of manipulating critical data to not only keep the team of Northrop Grumman and the European Aeronautic Defense and Space Co. in the game after both sides had submitted their tanker bids, but of making eleventh-hour changes that gave the bigger Airbus plane an advantage over Boeing's smaller 767.

"This is pretty serious stuff; it's not nitpicking," Richard Aboulafia of the Teal Group, an industry consulting firm, said of Boeing's allegations.

"And McNerney has gotten involved, too," Aboulafia said, referring to Boeing Chairman and Chief Executive Jim McNerney. "That says to me they would not be doing this if they didn't have something. Will it carry the day? I don't know."

The political element of the tanker saga also took a new turn on Tuesday, with the AP reporting that aides to Senator John McCain lobbied on behalf of EADS, and the co-chair of his campaign received $220,000 from the European defense giant in 2007, according to congressional lobbying records. In response to the AP report, McCain said he only tried to ensure that the process was fair and transparent.

"I had nothing to do with the (current) contract, except to insist in writing, on several occasions, as this process went forward, that it be fair and open and transparent.

"That was my involvement in it."

With the protest now on file, the GAO will have 100 days to investigate and report its findings. Until then, the tanker program is on hold. But, as we’ve noted in previous posts, the delay will likely be much longer.

Political and corporate haggling over big-dollar defense contracts has delayed several acquisition programs in recent years, including the Air Force’s next-generation combat search-and-rescue helicopter (CSAR-X). That contract was also initially awarded to Boeing, but protests from losing firms resulted in a new round of bids. The USAF now expects to name the winner of that contract later this year. That will mean further delays in the delivery of new choppers for its search and rescue units.

If history is any indicator, pressure from Boeing and its supporters will likely derail the tanker contract as well. With thousands of jobs—and billions of dollars—at stake, competitors will use any trick in the book to keep the bidding process open, and undercut their rivals.

Ironically, one of the few voices of sanity in yesterday’s debate came from Virginia Congressman Jim Moran, who could hardly be described as a friend of the Pentagon. As he observed during yesterday’s hearing:

I “believe that the professionals responsible for procurement acted in a professional manner,” Moran said. “Some of us believe that it is the Congress’ responsibility, if they don’t like the law, to change the law. But unless there is something that can be shown to us where the Air Force did not follow the law ... then the disappointment in the results may be only that.”