CPSC Reform Act

Floor Speech

CPSC REFORM ACT -- (Senate - March 05, 2008)

BREAK IN TRANSCRIPT

AIR FORCE TANKER CONTRACT

Mr. BROWNBACK. Mr. President, I thank my colleagues for allowing me a few minutes to speak about the tanker contract going to the Airbus-Northrop Grumman consortium. I am still worked up about this; I am going to be worked up about this for some period of time. This is a big impact contract. I want my colleagues to think for a minute about this, about us subcontracting out the building of our ships, our ships to the lowest bidder around the world.

If we said: OK. We are going to start building our ships wherever we can get the cheapest hulls for them, do you think we would be building them in the United States?

OK. I think other countries or other countries' governments would say: Well, now, here is a good deal. We want to be in shipbuilding, and so we are going to subsidize our way into this.

Do you not think we probably would end up building these ships in other places overseas? What we have taking place in this country is Airbus, which is subsidized with aid by European governments, is going to build basically these tanker planes and is going to fly them over here and then they are going to be fitted or militarized in this country. That is what is going to take place.

They are going to fly the whole plane over here and then militarize it. Now, is this a European plane or is this an American plane? This is an Airbus plane. It is going to be Airbus components. It is going to be built, it is going to be manufactured, it is going to be done there.

I ask my colleagues to think about this. Is this the right thing we want to do? Do we want our tankers and then our AWACS and our ships and our submarines, bid them out to the lowest bidder? In this process, my guess is we will have a lot built in Asia and South America and Europe and subsidized by governments.

I do not think this is the way we want to go. So before we move forward on this issue, I think we need to ask and have answered several questions. No. 1, what is the economic impact to our Treasury of outsourcing our military construction? These jobs are going overseas. That has an impact to our Treasury of the jobs being overseas instead of here.

Let's have a real, true economic picture of this taking place. I think we ought to have that. No. 1, I think we need to know the direct and indirect amount of the subsidization Airbus is giving to this plane to be able to get this contract. Because here we have a 40-percent bigger plane being produced by Airbus, at a substantially lower price than the Boeing aircraft, and they are not beating us on labor costs. They are certainly not beating us on exchange ratios, given the dollar to the Euro ratio.

There is no way to do this without heavy subsidization, either direct or indirect. You cannot do this without some subsidization. OK. Fine, let's find out what the number is, and then let's start where I guess we are going to have to compete on a subsidy, we compete on subsidization. But I think we need to know that number before we go forward with a multidecade, $40 billion contract of made-in-Europe tankers.

No. 3, I think we need to know our security vulnerability before we make those tankers overseas. I think there is a very real prospect that in the future, if we are involved in supporting the Israelis, and the

Europeans do not like it, they want to go more with the neighbors in the neighborhood, they say: OK, we are not going to give America flyover rights over Europe, and also we are not going to sell them spare parts on these tankers. I think we need know what the security vulnerability is before we go forward with this as well, and that needs to be appraised.

Finally, I would urge and we are starting to look at ``Buy American'' provisions in our military contracts. I am a free-trade person, but I think you ought to compete on an equitable playing ground, and that if they are going to subsidize, then we have to subsidize if they are; otherwise, we force them not to subsidize.

Also, on defense, we should not be dependent upon foreign governments for our Defense bill's military construction, particularly when they depend upon us for a lot of the security, and then they get the big contract to build the equipment.

I do not think this is fair at all. I do not think it is the right way for us to go. I think we have several vulnerabilities. I think if you look at a full economic picture of shooting these jobs overseas, of what that does to our Treasury versus buying a cheaper, subsidized European plane versus buying an American plane, where you are having your full costs, but your workers are here and they are paying taxes here, my guess is to the Federal Treasury it is a net positive for us to build them here, even if the plane costs us a bit more because we do not subsidize the price of the plane such as the Europeans are.

I have been in this fight previously on civil aviation, where the Europeans subsidized their way into that business. Now they are doing it in the military contract area. I do not think we ought to do it, particularly on a contract that is going to last decades.

So these are several questions we are going to be working on along with my other colleagues. I would hope we ask these big questions and get them answered before this big contract is let.

Are we are starting to build our defense industry in Europe rather than in the United States? I wish to thank my colleagues for allowing me to speak on this issue.

I yield the floor.

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