A BIG DEAL

by MONITOR
THE Pentagon's decision to award a $35 billion contract for air-refuelling tankers to the US company Northop Grumman and EADS, the European defence contractor, rather than to Boeing, has caused ructions in the United States. Both Hillary Clinton and Barack Obama have criticised the deal and John Murtha, the Chairman of the Congressional defence appropriations committee, said yesterday that Congress could block the order for 179 tankers because “political implications are important”. Boeing, whose KC-135 tankers are still in service after almost 50 years, had been expected to win this contract but the Pentagon found that the EADS Airbus A330 passenger jet was more suited for adaptation to air-refuelling work than Boeing's 767. The deal will guarantee employment to thousands of European workers for several years, among them some ten thousand at the UK's Broughton and Filton factories where the wings for the Airbus A330 are made. Northop Grumman said that 25'000 jobs will also be created in the United States. This work is said to be one of the largest defence contracts ever awarded in the United States and it is hardly surprising that Europe's share in it has caused surprise and immediate opposition. However Secretary of Defense Robert Gates put it in perspective when he said: “The reality is that we sell aircraft and ships and weapons systems all over the world, so there is a global aspect to this business.”