Bogus Tanker Deal Is On The Rocks

Posted on December 3, 2003

Well, whaddaya know. Remember when I told you about the shady deal Boeing had cooked up with the Air Force to lease it a bunch of refueling tanker planes? At the time I wrote that, it looked like the lease was a done deal, no matter how little sense it made. But now there’s been a wave of developments that indicate that common sense may be breaking out in the aerospace industry and the halls of the Pentagon after all.

The first bombshell came last week, when Boeing announced that they had fired two of their senior officials: Michael Sears, their Chief Financial Officer, and Darleen Druyun, a senior vice-president. The cause of dismissal was improprieties in hiring ethics; before she had joined Boeing, Druyun had worked as a weapons buyer for the Air Force, and had overseen hundreds of weapons systems acquisitions contracts. Among these was the now-notorious tanker deal. When it was being drafted, Ms. Druyun sat on the Air Force side of the table, negotiating terms for the government; then, once the deal was wrapped up, Druyun retired, and Sears offered her a job at Boeing, which she accepted. Boeing concluded that Sears’ hiring of Ms. Druyun had “conflict of interest” written all over it, and it’s hard not to agree.

Then came the even bigger bombshell: the resignation of Boeing CEO Philip Condit a few days later. The tanker fiasco was, however, just the straw that broke the camel’s back for Condit; Boeing has been taking a beating in the marketplace for a while now, and his board was already starting to mutter that new blood was needed, so I guess he figured he knew how to take a hint.

And, to top everything off, now that Boeing has raised the issue of unethical behavior in the letting of the tanker contract, the Pentagon has gotten cold feet; Deputy Defense Secretary Paul Wolfowitz told Congress today that there would be a “pause in the execution of the contracts” to allow time for the inspector general to look into the matter. Of course, the same sock-puppet Congressmen who pushed the flawed deal in the first place jumped up to insist that DoD get its little “ethics” fetish out of its system, so I suppose that this thing could still turn around and be back on track again the day after tomorrow. And who knows what the IG would have to turn up to scrap this piece of junk contract entirely. But it’s gratifying at minimum to see the way the deal was arrived at getting closer scrutiny, and one case of egregious Washington revolving-doorism getting smacked down as hard as it deserves to be.