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Boeing
CEO: W. James McNerney, Jr.
Defense Contracts 2005: $18.3
billion
Campaign Contributions, 1990-2006:
$4,661,907 (Democrat),
$5,977,472 (Republican)
Headquarters: Chicago, IL
Website: http://www.boeing.com
Overview
Boeing is the world’s biggest commercial jet producer,
NASA’s largest contractor, one of the Pentagon’s
top contractors, and the US’s largest exporter. Boeing
receives on average about $15 million a year in DOE contracts.
Boeing and its subsidiaries employ almost 200,000 people in
60 countries and 26 states, with customers in 145 countries,
and manufacturing operations throughout the US, Canada, and
Australia. Major operations are in Seattle, Washington; Southern
California; Wichita, Kansas; and St. Louis, Missouri. In the
past year, Boeing has expanded or opened offices in Brussels,
Tokyo, Beijing, Hong Kong, London, Paris, Moscow, Ghana and
South Africa. Since 1997, when Boeing acquired defense giant
McDonnell Douglas, Boeing has ranked as the Pentagon’s
No. 2 contractor, second only to Lockheed Martin.
Post 9/11
In the aftermath of the September 11th attacks Boeing’s
stock plummeted 16.8%. Sales to commercial airlines constitute
60% of Boeing’s business. With orders for commercial
aircraft down, Boeing expects to lose production of more than
1,000 airplanes. In response, Boeing is anticipating having
to layoff as many as 30,000 employees by the end of 2002.
Boeing DOD Contracts
| Year |
Rank |
Awards
(in Billions) |
| 2000 |
2 |
$12.0 |
| 1999 |
2 |
$11.6 |
| 1998 |
2 |
$10.9 |
| 1997 |
2 |
$9.6 |
| 1996** |
2 |
$1.7 |
*Boeing acquired MCDonnell Douglas in 1997, making Boeing
a major defense contractor. The $14 billion purchase was subsidized
by the Pentagon’s payment for executive bonuses, layoffs
and other "restructuring costs" under the 1993 "Payoffs for
Layoffs" legislation which passed with military contractor
political contributions ($10 million in 1996).
What
They Make
While not specifically involved in the development of nuclear
weapons, Boeing’s lead role in the National Missile
Defense system will have an impact on the future role of nuclear
weapons in the U.S. and in the world. Boeing’s Space
and Communications Group division is involved in everything
from operating the Space Shuttle, to creating new satellite-based
information and communications services, and overseeing many
of the missile defense programs. Specifically, Boeing is the
Prime Contractor for the contentious and dubious National
Missile Defense (NMD) system, and working on the Navy’s
Theater-Wide Missile Defense system and the Airborne Laser
program. Boeing also provides guidance systems for the Minuteman
and Peacekeeper missiles. (See Aerospace
Contributions for more information.)
Aircraft
and Missiles
Boeing’s Military Aircraft and Missile System division
produces some of the most advanced military aircraft in the
world, and a wide variety of "precision" munitions including
cruise missiles, air-to-ground missiles, and Harpoon missiles.
Among the aircraft are: the F-15 Eagle - the world’s
most sophisticated fighter plane and the "backbone" of the
U.S. Air Force; the C-17 Globemaster - the Air Force’s
"premier" airlifter; and the AH-64D Apache Longbow - the most
"lethal, survivable, deployable and maintainable multimission
combat helicopter in the world." Working with Bell Helicopter
Textron, Boeing is developing the troubled V-22 Osprey aircraft
for the Marine Corps, while Sikorsky and Boeing have joined
together to build the RAH-66 Comanche combat helicopter for
the Army. Buying nations include the United Kingdom, Turkey,
Israel, Egypt, Saudi Arabia, Greece, South Korea, Taiwan,
and Brazil.
Boeing and Bell Helicopter Textron began initial deliveries
of the 360 V-22’s, at an estimated cost of $30 billion,
to the US Marine Corps began in 1999. The tilt-rotor Osprey
takes off and lands like a helicopter and cruises like an
airplane. Still under development, the aircraft has had four
crashes in nine years, including one in 1992 that killed seven
Marines and two last year that killed 23. The most recent
crash, which killed four Marines, took place on December 11,
2000 and was the result of a hydraulic system failure and
computer software anomaly. While a private General Accounting
Office briefing to the Pentagon concluded that the V-22 has
severe mechanical problems and hasn’t been adequately
tested, the Marines and a handful of congressional supporters
feel the aircraft is essential for the 21st century. A decision
on full-rate production of the V-22 is on hold pending the
recommendations of an independent review panel. In 1998, then
Secretary of Defense Dick Cheney tried to kill the program
but failed. This time around, however, he may prove successful.
Boeing also has a role in the development of each of the
three next generation fighter aircraft, all of which were
conceived during the Cold War. These include the $62 billion
F-22 being built with Lockheed Martin
for the Air Force, the $46 billion F/A 18 E-F Super Hornet
being built by Boeing for the Navy, and potentially the $200
billion Joint Strike Fighter to be used by the Marines,
Navy and the Air Force. Both Boeing and Lockheed Martin had
been competing for the JSF contract. In late October 2001,
the Pentagon awarded the JSF contract to Lockheed, but there
has been discussion of sharing some of the work with Boeing.
Commercial
Applications/Products
Connexion by Boeing provides high-speed, two-way Internet
and live television services to aircraft in flight. The service
is currently available to the private business jet market,
with system installations on commercial airlines expected
to begin in late 2001 and into 2002. *This project is in jeopardy
because the three largest US airlines have pulled out as partners
following the Sep. 11th attacks.
In November 2000, Boeing and an industry team unveiled its
"fiber- and satellite-based system designed to revolutionize
motion picture film distribution." The satellite system allowed
Boeing to deliver the premier of the major motion picture
"BOUNCE" to the AMC Empire Theater in New York.
Boeing:
Taking Care of Business
In regards to the 2000 elections, Boeing, like most corporations,
was handing out generous campaign contributions. Soft Money
and PAC contributions totaled more than $1.5 million, with
58% going to Republican candidates. Boeing kicked in $100,000
for the Bush Inauguration, and $100,000 for the Democratic
National Convention.
Clearly, these donations are paying off. The Korean Herald
reported that Senator Christopher "Kit" Bond (R-MO), who received
$46,000 in PAC contributions from Boeing in his 1998 election
campaign, met with South Korea’s defense minister this
past January to "pitch" the sale of F-15 fighter planes. The
Boeing F-15 production line based in St. Louis, Missouri is
in danger of closing due to the lack of orders, but could
be saved with South Korea’s $4 billion plan to upgrade
its aging fleet. While Senator Bond certainly has his constituents
to think about, it seems actively lobbying on behalf of Boeing
for a foreign military sale represents a conflict of interest.
In addition to cultivating ties to members of Congress and
the Pentagon through campaign contributions and hi-paid lobbyists,
Boeing also provides financial support to such organizations
as Frank Gaffney’s right-leaning Center for Security
Policy. Former Senior Vice President of Washington Operations
for Boeing, Stanley Ebner, and Andrew Ellis, Vice President
for Government Relations at Boeing, are on the Center’s
Board of Directors. And providing Boeing with another inside
connection as of January 2001, is the former US Under Secretary
of State for Political Affairs, Thomas Pickering. Pickering’s
new position as Boeing’s Senior Vice President for International
Relations, based in Washington DC, should prove especially
beneficial to the company given Pickering’s long diplomatic
career as US Ambassador to Russia, India, Israel, El Salvador,
Nigeria, and Jordan.
Boeing:
From National to International
While Boeing works hard to shape the opinions and policies
of officials in Washington, DC, they’re also proving
to be a major player on the international scene. If there
are any questions about who reaps the greatest benefits from
the WTO, a look at who sponsored the Seattle meeting in November
1999 is instructive. In return for their $9.2 million in donations,
major multinational corporations were given privileged access
to the WTO proceedings. Weapons contractors Boeing and Allied
Signal/Honeywell both ponied up $250,000 or more to be "Emerald"
sponsors, entitling them to five seats at the Host Organization’s
opening and closing receptions and to an exclusive ministerial
dinner. Boeing CEO Phil Condit was a co-chair of the Host
Committee for the WTO, and as an Emerald sponsor Boeing received
four seats at the private sector conferences arranged by the
Host Organization, along with a number of other ‘insider’
perks.
What’s in it for Boeing and other defense corporations?
A lot. Arms makers are interested in the WTO agenda because
they too are in the process of becoming truly multinational
companies, dependent on exports to boost their profit margins
and willing to enter into joint ventures, partnerships, and
even mergers with companies in other countries. It’s
no surprise that Boeing, which makes $13 billion per year
selling missiles, combat aircraft, and other weapons systems
($3 billion in arms exports), would be a prime sponsor of
the WTO meeting. Boeing has been a strong advocate of WTO
membership for China, which provides a huge market for the
company’s airliners. And the Aerospace Industries Association
(AIA), of which Boeing is a member, has been pressing for
"normal" trade relations with China. The AIA has also taken
a stand against "unilateral" trade sanctions, a position that
would undermine efforts to limit weapons sales to repressive
regimes like those in Indonesia or the current government
in Turkey.
Under the WTO system arms corporations derive a double benefit.
Not only do they profit from the elimination of environmental,
health, and labor standards generated by the WTO process,
but their own activities in the military sphere - including
massive research and export subsidies from their home governments
-- are EXEMPT from challenge under the WTO’s "security
exception." This "security exception" gives governments a
perverse incentive to invest in the military sector at the
expense of civilian projects. Mike Sears, president of Boeing’s
Military Aircraft and Missiles division summed up the military
sector’s support for the WTO best when he said, "No
restrictions should be imposed on our ability to find the
best solution for our customers."
NATO
Expansion
In April 1999, while NATO ‘smart’ bombs were raining
down on Kosovo, a glittery gala party was taking place in
Washington DC to celebrate NATO’s 50th anniversary.
An A-list of weapons manufacturers, including Boeing, each
shelled out $250,000 for the events, including banquets, cocktail
receptions, luncheons, and invitation-only events at the embassies
of the new NATO allies - Poland, the Czech Republic, and Hungary.
Analysts have estimated that NATO expansion will be worth
$10 billion in fighter aircraft sales alone.
For more information please see Stoltz,
Christian. "Boeing: 2001 in Review (or, What You Won’t
See in the 2001 Annual Report)", St. Louis Economic Conversion
Project.
This fact sheet was prepared
by Michelle Ciarrocca for the Arms
Trade Resource Center
of the World
Policy Institute.
Aerospace
Contributions
This information
is also available as a printable, PDF
fact sheet!
Programs and
Products:
Boeing’s missile defense contracts more
than doubled from $1,350 million in 2001 to $2,930 million
in 2004, in large part due to increased spending on missile
defense. As a member of the US Air Force’s Intercontinental
Ballistic Missile Prime Integration team, Boeing will provide
engineering, flight controls, ground subsystems, and weapons
systems testing for the US Intercontinental Ballistic Missile
fleet until 2012.
Boeing is the prime contractor for the Pentagon’s largest
missile defense effort, the Ground-based
Midcourse system. Boeing is currently
developing, testing, and integrating all components for the
system. However, Boeing’s design for the Ground-based
system’s Exoatmospheric Kill
Vehicle was rejected in favor of Raytheon’s
design – not because it was technologically inferior,
but because it stole the design from Raytheon. The Center
for Defense Information reports,
“The Department of Defense spent $800 million over eight
years to determine whether Boeing or Raytheon would win the
EKV contract, only to be forced to hastily call off the competition
in December 1998 and award it to Raytheon after discovering
Boeing employees had misused proprietary software of Raytheon's.”
This incident did not prevent Raytheon and Boeing from teaming
up to work on the Standard
Missile-3. The two companies were contracted by the
US Missile Defense Agency to build the Standard Missile-3, which
is intended to be used to knock out incoming ballistic missiles,
for the Aegis Ballistic Missile
Defense System (which is part of the Sea-based
Midcourse Defense System).
Boeing is also one of Lockheed Martin’s
subcontractors for the production of Patriot Advanced Capability
(PAC-3) Missiles. The PAC-3
is used to destroy tactical ballistic missiles, cruise missiles,
aircraft, and potentially satellites. The PAC-3
missile system is to be used with Lockheed Martin’s Terminal
High Altitude Area Defense Weapon System. This system has
high-altitude, long-range capabilities and hit-to-kill lethality,
which means it can smash into opposing objects outside areas
currently covered by the US’ missile defense shield, enlarging
the “battlefield” during space wars. Boeing
built the propulsion system, which provides the Terminal High
Altitude Area Defense Weapon System interceptor with the ability
to maneuver as it closes in on its targets.
Boeing built the Experimental Spacecraft System-10 (XSS-10),
the first in a series of XSS mirosatellites. The XSS is intended
to inspect, maintain, and repair orbiting spacecraft “at
a lower cost and more quickly than an alternative program of
replacement from the ground.” However, defense officials
and technology experts agree that the XSS microsatellites have
dual-applications as anti-satellite weapons. Theresa Hitchens
and Jeffrey Lewis of the Center for Defense Information in Washington
argue,
“such a satellite could house a small kinetic-kill vehicle
designed to smash into a nearby enemy satellite,” while
the Air Force's 1999 Microsatellite Technology and Requirements
Study “raised the possibility of borrowing technology
from the Army's Kinetic Energy Anti-Satellite, or KE-ASAT, program
for its own microsatellites.” Boeing’s XSS-10
proved
in its test flight that it does not need any modifications to
kill a satellite.
The Boeing Orbital Express
System is another project aimed at developing a fully autonomous
(unmanned) satellite. The contract,
given to Boeing by the US Defense Advanced Research Project’s
Agency, is worth over $100 million. Like the XSS-10, its
primary objective is to refuel and service satellites on-orbit,
and, also like the XSS-10, it has clear military
applications.
The concept of an autonomous satellite has been riddled
with questions of technical and financial feasibility.
Multiple tests of unmanned objects, such as the Demonstration
of Autonomous Rendezvous Technology satellite, have ended
in failure. Aviation Week asks who would be willing
to risk billions of dollars on this technology – the answer
is apparently Boeing.
This research and report was
compiled by Ray Acheson of Reaching
Critical Will in February
2007 in coordination with the Secure
World Foundation.
For More Profiles:
See Boeing's PDF
Dirty Dozen profile.
Alliant Techsystems
BAE Systems
Bechtel Corporation
Boeing
British Nuclear Fuels (BNFL)
General Dynamics
IBM
Lockheed Martin
Mitsubishi
Northrop Grumman
Raytheon
Siemens
University of California
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