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Tue, Mar 10, 2009

Sources Say Obama May Opt To Delay KC-X Decision Until 2014

Budget Proposal Would Also Cancel New Bomber Program

We might soon know how the Obama administration plans to balance a number of high-dollar military programs, against slumping markets and a sluggish economy... and it isn't pretty. Citing three sources close to discussions now underway on the President's first defense budget, Congressional Quarterly reports the White House may tell the Pentagon to scrap all plans for a new long-range bomber... and, to push off a decision on the KC-X aerial refueling tanker program by five years.

As ANN reported in late February, the White House held off releasing full details of an expected $533.7 billion fiscal 2010 Defense budget until sometime in April, saying more time was needed to review the process. CQ sources say the Office of Management and Budget submitted several "offset options" to the Pentagon, including the two noted above, where to cut money to free up funds for other military programs, such as the F-22 Raptor and F-35 Lightning II.

If those reports are accurate, defense analysts say it's a sign there's a new sheriff in town over at OMB.

"OMB is beginning to show itself as a breath of fresh air after decades of prostrate compliance with Pentagon wishes," said Winslow Wheeler, head of the Straus Military Reform Project at the Center for Defense Information.

Still, those decisions -- in particular, the KC-X delay -- aren't likely to win many friends in the armed forces, or on Capitol Hill. Advocates for both the tanker and bomber say cutting those programs will hurt US strategic power, by forcing the Air Force to continue reliance on decades-old planes to fulfill those roles.

"The Air Force needs a new tanker desperately," said Air Force Association president Lt. Gen. Michael Dunn (Retired). "The KC-135 tanker averages over 47 years old, and the B-52 bomber is almost as old."

While opposition to the bomber cancellation may not have such a loud voice, as the program is still only in the development stages... lawmakers with vested interests in KC-X are expected to fight tooth-and-nail against the OMB's proposal, if it comes to fruition.

"For a group who has been in the OMB for just a matter of weeks to come in and suggest the cancellation of the Number 1 Air Force priority for procurement is stunning, and I don't think Congress will accept that," said Alabama Senator Jeff Sessions. EADS/Northrop Grumman plans to build a manufacturing and final assembly plant in Mobile if its Airbus A330-derived KC-45A is awarded the final KC-X contract.

As ANN reported, the KC-45A won the last round of bidding on KC-X in February 2008... but the decision was tossed out by the Pentagon later that year, after the Government Accountability Office upheld a protest from Boeing that the Air Force had miscalculated future operating costs to the advantage of the KC-45, over Boeing's 767-sourced KC-767.

Senator Sam Brownback -- representing Kansas, where Boeing would do final assembly work on the KC-767 -- expressed similar displeasure, calling the OMB guidance to delay the program "deeply disturbing."

"The longer we wait to begin building tankers, the more we jeopardize our many global operations, from war-fighting to relief efforts, which depend on this vital platform," he said.

Brownback and Sessions are both Republicans... so one might reasonably expect them to oppose any controversial proposal submitted by a Democrat administration, even if they didn't already have vested interests in the decision. However, the aide to one Senate Democrat told CQ opposition to the KC-X delay is crossing party lines.

"There is an effort among senior senators in both parties to make sure that we get moving quicker on the air refueling tanker contract," said the aide, speaking on the condition of anonymity, who added a letter to that effect is now being drafted to Deputy Defense Secretary William Lynn by Senators Kent Conrad (D-ND) and Orrin Hatch (R-UT).

"In the end, Congress will write the appropriations bills," the aide pointedly noted.

FMI: www.whitehouse.gov, www.boeing.com/ids, www.northropgrumman.com/kc45/

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