the advent of free trade agreements like NAFTA, the U.S. has lost hundreds of
thousands of manufacturing jobs abroad to countries that pay little more than
lip service to worker protection and environmental standards. For the most
part, corporate America has responded with yawning indifference, arguing that
American workers need to “adapt and evolve” to a changing global marketplace
and retrain themselves for higher skilled jobs.
result has been the hollowing out of many communities throughout California and
the country as jobs move offshore and tax bases dissipate.
days, there seems to be no winning, for even where American workers have honed
the most advanced technological skills anywhere in the world, our government
still seems poised to kick them in the teeth. The U.S. commercial aerospace
industry, the envy of the world and the last stronghold of American
manufacturing, is a prime example.
Europeans, particularly the French, have been engaged in what is widely
regarded in the U.S. as an illegal and systematic effort to steal jobs and
market share from American aerospace workers and firms by dumping more than
$100 billion in subsidies into their French-based aerospace company Airbus.
win by any means necessary,” pronounced the French prime minister a few years
ago. And they’ve been effective with this gambit, gaining nearly 50 percent of
the market while the American-based manufacturer Boeing was forced to shed
65,000 American jobs.
its part, the Bush administration has rightly responded by filing the largest
lawsuit in the history of the World Trade Organization against the European
Union. But the Bush administration is taking one step forward and two steps
backwards. Indeed, the U.S. Department of Defense is today poised to
countermand the administration’s own trade negotiators by insisting that Airbus
be one of the two competitors in the award for the U.S. Air Force’s crown jewel
of airframe contracts — a $40 billion tanker aerial refueling contract.
tanker jet is clearly the state of the art, having gained the lions’ share of
customers worldwide and having shown an impressive track record in its service
of U.S. troops. The Boeing tanker is American-made and would never be held up
or left unsupported by a country whose government suddenly went from ally to
enemy. An award to the American manufacturer could support 44,000 jobs and
hundreds of communities here at home. In California, this contract would mean
4,000 jobs and more than $175 million in annual revenue.
if Airbus wins the contract, the Department of Defense will create tens of
thousands of jobs in France and reward the very company that our trade representatives
have sued as rogue violators of trade laws.
a doubt, the Department of Defense needs to replace its refueling aircraft — a
point on which there is broad agreement. But after understandable outrage on
Capitol Hill over Boeing’s no-bid contract for the tanker replacement aircraft
in 2003, a once-criticized Department of Defense has this time perhaps
over-reacted and gone to the other extreme, insisting that the award must be
done on a competitive basis. The result is that a heavily subsidized European
manufacturer will be able to compete with the benefit of billions in government
subsidies against a U.S. manufacturer that receives no subsidies.
is not to say American aerospace manufacturers should get carte blanche simply
because of the tremendous value they provide to the American economy and
military base. Indeed, unions such as the International Association of
Machinists often fight to hold these companies accountable at the bargaining
table on matters relating to health care, wages, jobs and benefits. But the
tanker contract is about something different, and specifically whether the
European Union should be able to win U.S. defense contracts with what are
clearly lesser but heavily subsidized products.
considered the “arsenal of democracy,” America’s manufacturing base has shrunk
so dramatically in the last 40 years that in 2003 it even faced a shortage of
the most basic defense materiel — ammunition — forcing the U.S. government to
resort to foreign suppliers in Israel, Taiwan and Britain. The kind of blind
outsourcing of critical defense items gives foreign suppliers the equivalent of
a veto power on U.S. national security matters.
a divided Washington bureaucracy, it seems impossible to reconcile free trade
with competitive contracting. However, just as American workers have retrained
themselves for higher skilled jobs, bureaucrats must retrain themselves as
well. Competition may be the fuel of excellence, but if one team is on
steroids, then the cause of competition is hopelessly distorted.
aerial refueling tanker decision is about jobs, jobs for machinists, engineers,
programmers and thousands of others in a critical economic supply chain. That
supply chain can support the U.S. military and industrial bases in communities
all across the country — from Washington, California, Ohio, Illinois, Florida
and Alabama — or it can support jobs and communities in France. The choice is
Rich Michalski is
general vice president of the International Association of Machinists and