Another Sweetheart Deal for Boeing

The House Armed Services Committee early Thursday approved an amendment to its $441 billion defense authorization bill that could help protect the Boeing Co. from foreign competition for the building of midair refueling planes.

The amendment, according to defense industry specialists, would prevent the Pentagon from purchasing goods and services from foreign companies receiving subsidies from their governments.

Rep. Duncan Hunter, R-Calif., the committee chairman, included the Boeing provision in a package of amendments he introduced near the conclusion of the committee’s deliberations. Committee members approved the package by voice vote.

The amendment was aimed at disqualifying the European aircraft manufacturer Airbus from bidding on the contract for the refueling tankers, though neither Airbus nor its parent company were named in the amendment.

A spokesman for Rep. Adam Smith, D-Wash., a committee member, said Boeing should win the contract in any event.

“We believe that Boeing has a better product, would create local jobs in the Northwest and be better for the economy,” said spokesman Lars Anderson.

Construction of the new refueling planes could begin next year to replace the Air Force’s aging fleet of more than 500 aerial tankers.

Officials said that the Pentagon contract would amount to upward of $100 billion in the next few years, and support more than 1,000 jobs.

There has been intense competition between Boeing and EADS North America, parent company of Airbus, for the contracts. An earlier Boeing bid for the work under a $23.5 billion lease-and-purchase deal for the first 100 airplanes fell through in the worst Pentagon procurement scandal in 20 years.

Before becoming law, the amendment must cross over several difficult obstacles, including approval on the House floor, reaction from President Bush and a vote in the Senate later this year.

In addition, parts of the House legislation conflict with Defense Secretary Donald Rumsfeld’s plan to transform the U.S. military into a more mobile, light combat force.

Rather than accepting Rumsfeld’s ideas, the House bill put its money into more established military programs. Industry sources said that the committee cut considerably from the Army’s Future Combat System, a large-scale modernization effort led by Boeing.