Tanker Truths

12 May 2008
Senators Ask Bush Administration To Verify Northrop Grumman's Claims
The Seattle Post-Intelligencer is reporting that senators from Washington, Michigan and Oregon are asking the Bush administration to verify claims that Northrop Grumman's contract to build America's next generation of aerial refueling tankers will support 48,000 American jobs.

The newspaper quotes a letter from the senators to the White House in which they say they are "troubled by the inconsistent job projections" from the project. In addition, the newspaper reported, "After the Air Force announcement on Feb. 29, Boeing supporters complained that the contract meant more jobs in Europe and fewer U.S. jobs."

In fact, no American jobs are exported in the deal, and all sensitive military technology and hardware will be installed by Defense Department employees and Northrop Grumman workers with appropriate security clearances at a secure Northrop Grumman facility in Mobile, Alabama.

Northrop Grumman reaches its job estimate after contacting each supplier to find how many positions the contract will support - and then applying a commonly-accepted jobs-multiplier formula utilized by the U.S. Department of Commerce, and then an even more precise estimate using Department of Labor criteria.

By contrast, Boeing claims it would support 44,000 jobs if had won the contract - but has said publicly that it won't explain how it arrives at that figure.

Noted aviation industry analyst Scott Hamilton noted that Northrop Grumman provides far more detail on its estimates, writing in a March 18 column, "Northrop's methodology resonated, particularly since Boeing refused to disclose how it came up with its jobs figure despite questions from us and reporters. Without 'showing the math'... We didn't buy into the number at face value."

Hamilton notes that once Northrop Grumman won the contract, it focused for the first time on how many indirect jobs would be generated by the contract, arriving finally at its figure that the contract will support 48,000 jobs.

"All-in, given these job figures, the Northrop argument citing the DOC (Department of Commerce) formula, and Boeing's refusal to show the math made Boeing's job figures highly suspect, in our judgment," Hamilton concluded.

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