July 11, 2008
The news that the Pentagon has cancelled the Air Force’s award of the $35 billion tanker contract, requiring Boeing and EADS to submit new offers, may have unfortunate consequences.
Senior Defense Department civilians have for some time lack of confidence in the Air Force’s ability to manage the contract. The new bidding will be overseen by the Pentagon and not the Air Force.
Whatever the rights and wrongs of the decision, you can be sure that it will be perceived as a political exercise of economic nationalism, alongside the blocking of the CNOOC bid for Unocal and Dubai’s DP World’s bid for the management of six US seaports, on the pretence that they threatened national security.
This will make it much more difficult to combat economic nationalism elsewhere, particularly in China.Author : Stanley Crossick