But Says We Still Need The Tankers

A new report from the National Defense University is highly critical of the process by which Boeing reached a deal to sell and lease 100 767 refueling tankers to the Air Force -- while, at the same time, saying the process of replacing the tanker fleet must begin immediately.

The Washington Post says in Wednesday's editions that the NDU report has not yet been released. The paper says it's the second report to criticize the tanker deal, after similar scolding from the Defense Science Board. The National Defense University is based at Fort McNair and is overseen by the Chairman of the Joint Chiefs of Staff.

As ANN has reported, the tanker controversy reached a peak when Boeing's chief financial officer, Michael Sears, quit. Darleen Druyun, a former USAF assistant deputy secretary who quarterbacked the government's negotiating team on the tanker deal was summarily booted from Boeing at the same time. Later, she was indicted for and pleaded guilty to taking the Boeing job while still working for the government and then tilting the competition for the tanker contract toward her new employer.

Others, including Senator John McCain (R-AZ), have blasted the $23.5 billion deal, saying it's not much more than a Boeing bail-out in the face of slumping commercial sales. Defense Secretary Donald Rumsfeld was expected to decide this week on whether to go ahead with the controversial agreement. Instead, with the NDU and Defense Science reports in hand, Pentagon insiders tell the Post Rumsfeld will now probably wait until the end of the year before announcing a decision.

The National Defense University, Boeing and the Air Force do agree on one thing: modernizing the tanker fleet, now some 40-years old, will take three decades and "must begin now!" (NDU put that exclamation point in there, not us). The university was critical, however, of the way the Air Force seems to be getting there.

In most cases, when the Pentagon buys new military technology, it sets out the best options for meeting the need, then picks one. But in upgrading the tanker fleet, Congress acted before the Pentagon had even set forth the requirements for a new-age tanker. That led the Air Force and Pentagon to "[bypass] many elements of the 'normal' acquisition system," the report said.

Instead of trying to get the biggest bang for our collective buck, the Post reports NDU's findings were that there appeared to be "only limited use of considerable government buying power and leverage to obtain maximum discounts," the report said. While the rules on pricing were followed, the Post reports, NDU said they were "liberally interpreted."

As for any competition from Boeing's chief civilian rival, Airbus, the NDU report said there really wasn't any, despite protests from Boeing headquarters in Chicago. The reason? The Post quotes the NDU report as saying there was "little expectation that Congress would allow leasing of Airbus aircraft. It appears contractor selection was a foregone conclusion."

That's where the Post reports Boeing executives get a little touchy. Spokesman Douglas Kennett told the Post his company's proposal "was lower cost, lower risk, technologically superior and more flexible in basing and deployment."

FMI: www.ndu.edu