Should Foreign Companies Make U.S. Military Equipment?

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This is a partial transcript of "The Big Story With John Gibson," August 23, 2006, that has been edited for clarity.

JOHN GIBSON, HOST: Boeing aircraft corporation is fighting for a $20 billion deal with the Pentagon to build a new fleet of military air refueling tankers. Boeing's competitor on this deal is Airbus, which is partially, substantially owned by the French government. That's right, we are talking about giving the French government the job of building a large fleet of our critical military aircraft.

Here now is Boeing's vice president for Air Force programs, retired Lt. Gen. John Sams.

How critical is this fleet of air tankers?

RET. LT. GEN. JOHN SAMS, BOEING VP AIR FORCE PROGRAMS: Well, John, this is absolutely critical to everything that we do in our military, whether it's delivering cargo to the front, if you refuel the airlifters, you can carry more cargo on the airlifter itself. For our fighters and bomber forces, you can persist longer over the battle area and fly further with the benefit of air refueling. So everything we do involves air refueling of that force, whether it's Air Force or Navy aircraft to be refueled.

GIBSON: You represent Boeing and Boeing wants to do this deal. What difference does it make whether Boeing builds these jets or a company owned by the French government builds these jets?

SAMS: Obviously, we think it's good for our country if Boeing builds these jets because we believe we have the best technology. We have been in the air refueling business for a long time. So we are making generational improvements on proven capabilities. So we think we are low risk for our customer and we think we provide the best value for the American taxpayer. That's why we think we will be very competitive and we will win this competition.

GIBSON: Do you know why the Congress has agreed to allow a company that is, in part — but a substantial part — owned by a foreign government compete for this contract?

SAMS: Well, I think what our Congress and our Air Force is trying to do is provide the best value for the American taxpayer and they value a competition. Certainly, we compete all over the world, as well as domestically. We are prepared for the competition and we're ready to move forward.

GIBSON: The air tankers, it's a fleet of 500 some odd. How long is it going to take to build new ones? How quickly do they come on line and how long are they supposed to last?

SAMS: Well that's the great challenge here because the fleet is large because of the requirements it has to satisfy. As you mentioned, there are over 500 airplanes, so how do you replace that fleet of airplanes in a timely manner? And the answer is you don't. You have to buy the number per year that you can afford.

Traditionally, in large airplanes, that has been somewhere in the neighborhood of 15 airplanes per year. So you can see it's going to take 25 years to replace the fleet. And the matter is not that we are going to be flying or not flying 80-year-old tankers. We will be. The real question is: How many of them will be left when they're that age?

GIBSON: General, it's my understanding that in order to entice the French government to build a plant, to build these planes in Alabama, the Alabama government has set aside $25 million of Katrina funds to give to this French company to help build that plant. Is that fair for Boeing to be competing against Katrina funds?

SAMS: Well, obviously, we look to the Air Force to establish the fairness in competing this program. And I've read the same articles, obviously, that you have and we trust that our Air Force will put together a competitive package and we look forward to competing.

GIBSON: Retired Lt. Gen. John Sams, now the Vice President of Air Force Programs at Boeing, thanks a lot.

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