Marathon Pundit: Ideas to boost the economy: Buy American weapons and export American weapons

Thursday, June 10, 2010

Ideas to boost the economy: Buy American weapons and export American weapons

How to rebuild the economy? One way is to increase our exports.

From Defense-Aerospace.com:

On March 11, President Obama signed an executive order establishing a "national export initiative." The order implements his commitment in the State of the Union address to double U.S. exports over the next five years. It's a very ambitious goal: the last time America doubled its exports in five years was during the Carter Administration, and that surge was traceable largely to inflation. U.S. exports of goods and services in 2009 totaled $1.55 trillion, which means exports must increase by an average of $300 billion every year between 2010 and 2014 to meet the administration's goal.

The export goal cannot be achieved unless the Obama Administration begins with a realistic appraisal of where America currently stands in the global trading system. Many of its key trading partners -- China, Japan, South Korea, Taiwan -- are export-driven economies that historically have sought to limit imports of non-essential goods. Washington will need to work hard to tear down formal and informal trade barriers that impede the overseas sale of U.S. products. It will have to force European governments to stop giving illegal subsidies to Airbus that put Boeing -- America's biggest exporter -- at a disadvantage in the commercial transport market. It will have to challenge aggressively China's theft of intellectual property and manipulation of exchange rates.

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One area where there is real room for improvement is foreign military sales. America still builds the best weapons in the world, and virtually all key weapons plants are located within U.S. borders. Although the U.S. currently has a 68% share of the global arms market, there is much room for expansion as traditional allies replace aging Cold War weapons and emerging nations like India acquire the resources to afford pricey U.S. military systems. Defense secretary Robert Gates has taken the first steps to ease export regulations, but there is much more that could be done to position U.S. producers competitively in the Middle East and elsewhere. With arms production now constituting about a tenth of all U.S. manufacturing output, it isn't likely U.S. exports can double unless defense contractors make a much bigger contribution to the America's balance of trade.

If we want to export American to bolster our economy, it makes sense that we also buy our own products. The Air Force is accepting bids on a new mid-air tanker. European owned Airbus is an intersted party, but as I've written previously, not only is its plane flawed, but Airbus and its parent, EADS, is an unfair trader--worse, it displayed its wares at a 2005 Iranian air show.

But as Flightglobal.com explains, Boeing is on the ball with that tanker, which is currently known by its prototype name, the KC-X:

Boeing has demonstrated the next-generation boom technology included in its offering for the US Air Force's KC-X tanker competition, and says it is on track to meet the 9 July deadline for bids.

"We have a great deal of confidence in that technology," says Boeing Defense, Space and Security chief executive Dennis Muilenburg. "We demonstrated the capabilities. It is a next-generation boom with fly-by-wire and it is ready for the tanker schedule."

Muilenburg declines to reveal more details about the company's 767-based NewGen Tanker, but says the offering includes "technological insertions from other programmes", such as the 787 cockpit.

Boeing is also drawing on lessons learned from the tankers it has developed for Japan and Italy, says Muilenburg.

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Thursday, June 10, 2010

Ideas to boost the economy: Buy American weapons and export American weapons

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