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The Joint Strike Fighter: The Deal of the Century
posted by admin on Thursday November 08, 2001 @01:11 PM
from the commondreams.org dept.
News Published on Thursday, November 8, 2001

by Michelle Ciarrocca

The consolidation of the U.S. defense industry during the 1990's leftthe jet fighter building business to primarily two companies: LockheedMartin and Boeing. Analysts have warned that the recent decision toaward Lockheed Martin a $19 billion contract for the next phase ofdevelopment in the Joint Strike Fighter (JSF) program could mean thatonly one fighter jet company remains. "The loss could theoretically putBoeing out of the fighter business once [Boeing's] F-18 is completed,"said Christopher Mecray, aerospace analyst at Deutsche Banc Alex. Brown.Boeing is also hurting from a sharp decline in orders of its' commercialjet unit. Since early September Boeing stocks have dropped 30%. As aresult, Boeing is preparing to layoff up to 30,000 workers by mid-2002.

But Boeing may still have a role in the JSF program, especially iflegislators from Missouri have anything to say about it. In Boeing'scorner are Senators Christopher Bond and Jean Carnahan, who havesuggested offering legislation to require the military to splitproduction and set up two production lines, one in Fort Worth and one inSt. Louis to keep Boeing in the fighter business. "This debate should beabout what is best for the nation, not Texas, Missouri or any onecompany," Bond said.


Yet if that were truly the debate, maybe the DOD and members ofCongress would be debating whether or not the U.S. should be developingthree advanced fighter planes. Despite campaign promises by PresidentBush to "skip a generation" in weapons procurement, all three of thePentagon's advanced fighter plane programs are moving forward. Inaddition to the JSF, the Pentagon is developing two other advancedfighter planes: the F-22 raptor and the F/A-18E/F Super Hornet. The F-22program is estimated at $63.4 billion for 339 aircraft, being developedby prime contractor Lockheed Martin and Boeing. The Super Hornet is a$47 billion project for 548 tactical attack aircraft (at $86 million apiece) to be used by the Navy and the Marine Corp, being developed byBoeing and General Electric (prime contractors, and Northrop Grumman asubcontractor).

Nevertheless, Texas Senator Kay Bailey Hutchison has promised to blockany efforts by Missouri's delegation to require that work on the JointStrike Fighter be shared with Boeing. Hutchison said that LockheedMartin won the $300 billion contract fairly and that the legislationproposed by Sen. Bond would serve to undo the government's decision.However, Hutchison said she wouldn't oppose Lockheed voluntarily sharingsome work with Boeing. Both Hutchison and Bond sit on the defenseappropriations subcommittee, which has the lead Senate role in settingdefense spending.

The St. Louis Post-Dispatch reported that Jerry Daniels, chiefexecutive of Boeing's military division, said last week that the companystill hopes to get a "meaningful" piece of the Joint Strike Fighterwork. Lockheed Martin asked Boeing to evaluate how they might contributeto the project. Boeing is also working on a sizable portion of the F-22program and has a number of weapon contracts with the Pentagon includingthe F/A/-18, the F-15E Eagle, AV-8B II Harrier, T-45 Goshawk, and theC-17 Globemaster III. Boeing is also the prime contractor for theNational Missile Defense system that the Bush administration is pushingso hard.

The JSF (also called the F-35) is being advertised as the "world'spremier" strike platform to be unveiled in 2008 when the first 22 planesare delivered. The multi-role strike fighter will be used by the AirForce (in place of A-10s and F-16s), the Navy (F/A-18s), and the Marines(AV-8Bs). The UK is a full partner in the program. Denmark, Norway, theNetherlands, Canada and Italy have joined as partners and Singapore,Turkey and Israel are foreign military sales participants for thisphase. Britain's Royal Air Force and Navy have committed $2 billion tothe development and is planning to purchase 150 of the fighter planes.Northrop Grumman and British Aerospace, and possibly Boeing, aresubcontractors. Each plane is projected to cost $40 million a piece.

If the program proceeds according to plan, the Pentagon will request3,000 F-35s, making it the largest acquisition program in history. Thetotal value of the contract could be worth more than $300 billion.Knowing the stakes involved in a deal of such proportion, the five-yearcompetition between Lockheed Martin and Boeing was fought, not only byengineers and scientists, but also by high paid lobbyists andadvertisements too.

The Center for Responsive Politics reported that Lockheed Martin spentmore than $9.8 million lobbying members of Congress and the Clintonadministration during 2000, more than double what the company spent in1999. Boeing spent $7.8 million in lobbying expenditures during 2000,$400,000 less than 1999. Campaign spending (soft money and PAC) for the1999-2000 cycle by Lockheed totaled more than $2.7 million, withtwo-thirds going to Republicans, while Boeing gave $1.9 million tocandidates and parties with an even split between Republicans andDemocrats. Boeing also kicked in $100,000 to the Bush-Cheney inauguralfund, while Lockheed gave $225,000. Lockheed also sweetened the deal byplaying up its Texas connection. Work will be done in 27 states andBritain, with final assembly at Lockheed's Fort Worth plant, potentiallyleading to 9,000 new jobs.

The Lockheed team had one other "inside connection" - Air ForceSecretary James Roche chose the winner. What's the big deal? Well,before being appointed to Secretary of the Air Force, James Roche servedas corporate Vice President of Northrop Grumman and has worked forNorthrop since 1984. Maybe a conflict of interest? Northrop Grumman hasa significant role in the development of the JSF - three of itsoperating sectors -- Integrated Systems, Electronic Systems andInformation Technology -- have been developing advanced technologies forJSF in areas that include aircraft systems, stealth, sensors andsoftware engineering.

Gleeful and confident, Lockheed Martin Chairman Vance Coffman said hiscompany would build a "truly remarkable, capable and affordablemulti-role fighter, on schedule and on cost." However the GeneralAccounting Office (GAO) has warned numerous times that the jet is likelyto cost more, take longer to build and have performance problems. Infact, the General Accounting Office released its' latest report on theJoint Strike Fighter just weeks before the Pentagon made its decision.The GAO report stated, "We disagree with DOD's assertion that technologyis mature enough to move forward. The technology readiness levelassessment conducted as part of our review of the JSF showed thatcritical technologies are not projected to be matured to levels thatwould stem risks at the start of engineering and manufacturingdevelopment. Our previous work has shown that when programs proceed inthis fashion, they experience delays, rework, and substantial costincreases that could force the Department to divert much-needed fundsfrom other important weapon system programs."

Michelle Ciarrocca is aResearch Associate at theWorld Policy Institute.

###

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