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The debate is on over loss of Boeing contract

boeing logoOn February 29, the loss of a $40 billion contract by Boeing Co. was reported by Peter Cohan on BloggingStocks. Since that time, debate has been quietly rumbling in various spots around the Internet regarding the placement of that contract. Initially, it was expected that Boeing Co. would receive the order but it has instead been awarded to Northrup Grumman and EADS, parent of Airbus, which detractors say puts an unacceptable amount of control and revenue of an American military contract into the hands of a European corporation.

The contact is for the building of refueling tankers which refuel fighter jets while in flight. I have found estimates which claim that the contract value could reach as high as $100 billion dollars, but $40 billion is the media reported estimate. It appears that even though corporate administration of the contract would be taken overseas, at least some of the work would still be performed in America. Additionally, we should consider that major components of these and other military aircraft already originate from foreign manufacturers.

Hard-line protectionists and the union ilk are clamoring for congressional reversal and investigation of the contract assignment, while straight line capitalists and globalists claim that business is business and that all is fair in contract negotiation. So far, I have found no indication that the matter shall be treated by our government as anything other than an ordinary manufacturing contract.

My personal opinion is that it's just a contract, and the United States Air Force has the right to purchase aircraft from whomever they deem fit to provide them in a timely and cost effective manner. Perhaps the matter could be given a cursory review by Congress just to make sure that everything is square, but basically, if there's not an overt reason to suspect some manner of undue manipulation, let's just drop it and let them build some tankers.

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