He said, she said playing out over WTO ruling and its impact—or not—on the KC-X tanker deal.
September 14, 2009—Until the World Trade Organization completes work on the Boeing-Airbus dispute—expected within four months—and releases it publicly, we may not have a full accounting.
We reported earlier that US Rep. Norm Dicks (D-Wash.) says the WTO's interim report sides with the US and Boeing, saying European Union subsidies to Airbus provided the French company with an unfair advantage. Other long-time Boeing supporters, like Sen. Patty Murray (D-Wash.) (statement) and Rep. Todd Tiahrt (R-Kan.) (statement), who both issued statements Sept. 4, agreed with that interpretation.
However, Sen. Richard Shelby (R-Ala.), who favors the KC-X tanker being offered by Northrop Grumman-EADS (parent of Airbus), issued a Sept. 10 statement that refutes that claim.
Shelby wrote to US Trade Representative Ron Kirk that "many press reports are not accurately describing the complete results of the report." He claims that the A330-200, the Airbus aircraft upon which the Northrop-EADS team would base its KC-X, "was found to have received investment aid within the permissible benchmarks under WTO guidelines."
And, he reminds Kirk, that the "interim report is only an initial recommendation and the first step in a multi-year process."
Shelby maintains that applying the WTO interim ruling to the USAF tanker competition—expected to restart this month—would "be a grave mistake, with severe consequences to both our economy and trade relations."
Readers will remember that Northrop-EADS won the original tanker competition and expected to construct a production facility in Mobile, Ala., for final assembly. If Boeing won the new competition, its production facilities in Kansas and Washington would gain.
To side-step this continuing political quagmire, some lawmakers have been pushing the Pentagon to consider buying two tankers; however Defense Secretary Robert Gates has adamantly protested such a move as more costly.
It appears that he may have won that battle (read this report from DOD Buzz).
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