OPINION & EDITORIAL
Congress needs to warm up to foreign investors, or else
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by Andrew Wagner
Friday, March 7, 2008
How many of you remember the controversy two years ago concerning the planned sale of shipping operations at six United States ports to Dubai Ports World? You know, when Congress demanded to know why we were risking our national security by selling these operations to those “Muslims?” When Congress eventually hounded Dubai Ports World to give up any attempt at managing these ports?
Well, you’ll be happy to know that Congress has discovered a new and grave threat to our national security: Europeans!
The current mess involving congressional antipathy toward foreign companies began with the 1950s aerial tankers that the Air Force still uses to refuel planes in flight. Around the turn of the millennium, the Air Force began exploring options for replacing these old tankers with new ones. Initially, Boeing floated an extremely lucrative contract to conduct the development and production of a new tanker plane. However, after Boeing received this contract, a number of irregularities came to light.
Not only was there an enormous amount of behind-the-scenes lobbying and spending to convince officials to support the plan, but also some key Pentagon procurement officials ended up receiving lucrative consulting jobs with Boeing after the tanker deal was struck. Fortunately, Boeing’s unethical conduct was exposed, and the deal was abrogated, with Boeing being fined hundreds of millions of dollars.
Recently, Boeing battled with the Northrop Grumman European Aerospace Defense Systems for a federal contract of $40 billion, which NGEADS won because their plane design was rated higher than Boeing’s on most performance criteria. For those unfamiliar with the company, NGEADS is the parent company of Airbus, Boeing’s main passenger plane competitor.
Immediately after the announcement of the contract award, Boeing mobilized its allies in Congress to attempt to block the deal. Possibly unlike any other issue, lawmakers from both parties united to lay obstacles for the deal and try to secure a slice of the $40 billion pie for themselves. Some lawmakers argued that a foreign firm shouldn’t have anything to do with our national security. Others argued that American firms should be building American planes with American workers and American parts. These lawmakers, undoubtedly after a little “persuasion” from Boeing, are working to skewer the contract.
To put it bluntly, these politicians are full of shit. Anyone with one eye and half a brain can see that having a European firm working to assemble these aerial tankers is not going to threaten American national security. Most of Europe is in NATO, and while the United States and parts of Europe don’t always get along, it’s not going to ever amount to military conflict.
As for those lawmakers protesting over the loss of jobs and revenue, apparently they have overlooked the fact that thousands of American workers in Mississippi and Alabama will be working to assemble these aircrafts. Furthermore, as Northrop Grumman correctly points out in a press release, a modern airplane uses parts from suppliers worldwide. A Boeing tanker would use just as many foreign parts.
Foreign car manufacturers do the same thing. They build plants here in the United States to build their cars and use American workers. That is what we call a “win-win” situation.
On its own this situation would be bad enough. However, this incident coupled with the Dubai Ports World debacle could very well discourage foreign companies from participating in sectors of the American economy.
The lesson to take away from this debate is to carefully evaluate the sort of economic populism that comes out of the mouths of lawmakers. After all, many calls for protectionism originate from corporations themselves — entities that stand ready to pad profit margins and in the case of Boeing, try to rip off the taxpayers due to the lack of competition. Too often the knee-jerk reaction to foreign competition is to try to slam the door shut on a situation that can actually benefit American workers.
Andrew Wagner (awagner@badgerherald.com) is a junior majoring in computer science and political science.
Anonymous (March 7, 2008 @ 2:11pm):
Get over yourself! The Dubai Ports controversy had nothing to do with the owners being Muslims, but rather with the fact that the owners are effectively members of the government of a nation that provides material support to terrorists.
And why should we outsource OUR security to any other country? What kind of idiocy is that? "Please, Djibouti, protect us from those meanies!"
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