BAE SYSTEMS
Buzzards Absent Ethics
Sightings from The Catbird Seat
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May 19, 2008
Navy on alert for marine
mammals while training
By William Cole, Advertiser Columnist
When the USS Ronald Reagan aircraft carrier strike group conducts anti-submarine warfare training off Hawai'i this month, the Navy will be playing a tense cat-and-mouse game not only with submarines, but also with a more slippery opponent — marine mammals.
It's not that the Navy dislikes whales and dolphins, but after being slapped with a series of lawsuits over the potential harm caused by active sonar "pings," the service has to be more wary of the sea creatures.
Increasingly, that requirement has come via federal court order. U.S. Rep. Neil Abercrombie, D-Hawai'i, thinks there might be another way.
The House Armed Services Committee last week approved $67.45 million in funding for defense projects in Hawai'i, including $8.5 million for further research, development and installation of marine mammal detection systems on Navy aircraft.
"I'm very pleased to be able to kind of take the lead on this so we can get out of the courtroom, and into the area of trying to resolve the issues once and for all," Abercrombie said. "This is one of the most serious and contentious issues in the military today."
BAE Systems in Hawai'i has been involved in the development of an airborne survey system that "automatically and harmlessly" detects the presence, location, and movement of marine mammals, according to Abercrombie's office.
The project adapts work done for the United Kingdom Ministry of Defense to the needs of the U.S. Navy, and integrates it with sensor technology developed by BAE Systems in Hawai'i.
Abercrombie said it's "still a bit theoretical" and still in the realm of research and development.
Of the $8.5 million approved in committee last week, BAE Systems would receive $6 million for the "Marine Mammal Awareness, Alert and Response Systems" project.
The other $2.5 million would go to Guide Star Engineering for something called the "In-buoy Signal Processor."
Abercrombie's office said that project seeks to alter the sonobuoys that the Navy already drops from aircraft so they detect marine mammals as well as enemy subs.
Among requirements ordered by a federal judge in Honolulu in February were "safety zones," including the need for the Navy to power down active sonar by 6 decibels when a marine mammal is spotted within 1,500 meters of a sonar-emitting vessel.
The sonar power must be stepped down the closer the animal is, and within 500 meters, all sonar transmission must cease.
U.S. Pacific Fleet said in a statement afterward that the restrictions "could seriously impact our ability to train effectively."
At least 26 species of marine mammals frequent Hawai'i waters.
The use of mid-frequency Navy sonar was determined to be a "plausible, if not likely" contributing factor to the mass stranding of up to 200 melon-headed whales in Hanalei Bay during Rim of the Pacific naval exercises in 2004....
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For more, GO TO > > >
Defending the Silence of the Seas;
Kill Willy (and Flipper and Keiko and Shamu): U.S. Navy Collateral Damage;
US Navy Asks To Be Exempted From Federal Law Forbidding Harassment or Killing of Whales;
Navy Sued Over Harm to Whales by Mid-Frequency Sonar;
Environmental Groups Sue over U.S. Navy Sonar Plans;
May 16, 2008
Saudis 'resist Bush oil pressure'
BBC News
Saudi Arabia has rejected an appeal by US President George W Bush to raise oil production, a US official has said.
Saudi officials said they were already meeting demand, and had increased production by 300,000 barrels per day earlier this month.
The news came after talks in Riyadh between Mr Bush and King Abdullah.
The US wants an increase in production to help curb record prices, currently $127 a barrel, but Saudi officials blame speculation not supply shortages.
"Supply and demand are in balance today... The fundamentals are sound," said Saudi Oil Minister Ali al-Nuaimi....
"How much more can we do?"
'Doing everything'
US National Security Adviser Stephen Hadley said the Saudi government had indicated it would put as much oil on the market as necessary to meet demand.
"What the Saudis wanted to tell us was we're doing everything we can do... to meet this problem, but it's a complicated problem," he said.
He added that the Saudi authorities thought it was unlikely that boosting production would reduce the price....
Mr Bush's visit to Saudi Arabia follows a trip to Israel to coincide with the 60th anniversary of the country's foundation.
http://news.bbc.co.uk/go/pr/fr/-/2/hi/middle_east/7404040.stm
See also...
http://www.hermes-press.com/BushSaud.htm
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<<< SHORT FLASHBACK FOR PEOPLE WITH SHORT MEMORIES <<<
June 22, 2007
Scandal of the Century
Rocks British Crown and the City
by Jeffrey Steinberg
On June 6, the British Broadcasting Corporation aired a sensational story, revealing that the British arms manufacturer BAE Systems, had paid more than $2 billion in bribes to Saudi Arabia's national security chief and longtime Ambassador in Washington, Prince Bandar bin-Sultan, over a 22 year period.
The BBC revelations were further detailed on June 11, in a one-hour Panorama TV documentary, provocatively titled "Princes, Planes and Pay-offs," which detailed a more than decade-long probe by the Guardian, BBC, and the British Serious Fraud Office (SFO), into the al-Yamamah arms contract, a nearly $80 billion, 22-year long deal between BAE Systems and the Saudi government, in which British-made fighter jets and support services were provided to the Saudi Kingdom, beginning in 1985.
Every British government, from Margaret Thatcher, through John Major, to Tony Blair, has been thoroughly implicated in the BAE-Saudi scandal. In December 2006, Britain's Attorney General, Lord Goldsmith, ordered the SFO probe shut down, declaring that any further investigation would gravely jeopardize British national security. Prime Minister Blair fully backed his Attorney General, and is now scrambling to complete the fourth phase of the al-Yamamah deal before he leaves office next month.
The furor that followed the Goldsmith announcement triggered a number of international investigations into the BAE Systems scandal, including by the Swiss government and the OECD (Organization of Economic Cooperation and Development, the so-called "rich nations" club). More recently, the U.S. Department of Justice has reportedly opened a probe into money laundering and possible violations of the Foreign Corrupt Practices Act, on the part of the British and the Saudis. The estimated $2 billion in cumulative payoffs to Prince Bandar, for his role in brokering the al-Yamamah deal, went through the Saudi government accounts at Riggs Bank in Washington, D.C., thus opening the U.S. jurisdiction.
While the various British investigations into the al-Yamamah (Arabic for "the dove") arms deal did unearth a vast network of front companies, offshore shells, and corrupt politicians, who benefitted richly from the deal, EIR's own preliminary investigation into the scandal has uncovered a far more significant story, one that will send shock waves through the City of London financial circles, as well as top figures within the British monarchy, who are all implicated in a far bigger scheme that goes to the very heart of the Venetian-modeled Anglo-Dutch Liberal system of global finance, which is now on its last legs.
Al-Yamamah
In 1985, the Kingdom of Saudi Arabia, in part frightened by the ongoing war between its neighbors Iran and Iraq, which had reached a highly destructive phase known as the "war of the cities," sought to purchase large numbers of advanced fighter jets to build up their Royal Air Force.
Initially, the Saudis sought approval from the Reagan Administration to purchase American-made F-15 fighters. The Saudi F-15 deal required Congressional approval, and the America Israel Public Affairs Committee (AIPAC) waged a massive effort to kill the sale.
According to several well-informed Washington sources, Howard Teicher, a senior official on the Reagan National Security Council (director of Near East and South Asia, 1982-1985; senior director, Politico-Military Affairs, 1986-1987), also played a pivotal role in the AIPAC effort, which ultimately succeeded in killing the deal. Teicher, according to the sources, withheld information from Reagan, stalling a Congressional vote until AIPAC had fully mobilized, and then convinced the President to withdraw the request, rather than face an embarrassing defeat in the Congress.
Other sources have offered a slightly different version of the failure of the F-15 deal, claiming that intelligence community estimates, since the mid-1970s, had warned of instability in the Persian Gulf, and that there were, therefore, other reasons to question the advisability of the sales of advanced U.S. military technology to Saudi Arabia, particularly after the Khomeini Revolution in Iran.
Whatever the reason, the F-15 deal failed. The very next day, after the Reagan Administration threw in the towel, Prince Bandar, the Kingdom's de facto chief diplomat to Britain, the Soviet Union, and China, as well as the U.S.A., flew to London to meet with Prime Minister Margaret Thatcher. British arms sales did not require parliamentary approval, and the British government, in 1966, had created an agency, the Defence Export Services Organization (DESO), to hawk British arms around the globe.
BAE Systems had been created in 1981, when Thatcher privatized the British arms manufacturing industry, which had, only four years earlier, been nationalized under the Labour government. And BAE Systems, the largest arms manufacturer in Europe, dominates the British defense sector.
The Bandar trip to London to confer with Thatcher had been in the works for months. A Ministry of Defence briefing paper, prepared for the Thatcher-Bandar sessions, stated, "Since early 1984, intensive efforts have been made to sell Tornado and Hawk to the Saudis. When, in the Autumn of 1984, they seemed to be leaning towards French Mirage fighters, Mr. Heseltine paid an urgent visit to Saudi Arabia, carrying a letter from the Prime Minister to King Fahd. In December 1984, the Prime Minister started a series of important negotiations by meeting Prince Bandar, the son of Prince Sultan.... The Prime Minister met the King in Riyadh in April this year and in August the King wrote to her stating his decision to buy 48 Tornado IDS and 30 Hawk."
Thatcher also had every reason to feel confident that Bandar would be the perfect interlocutor between Saudi Arabia and Great Britain in the deal of the century. At age 16, several years after his father, Prince Sultan, had been named Minister of Defense of the Kingdom, the Prince was sent to England to study at the Royal Air Force College Cranwell, the elite officer's training school for future RAF pilots.
At least one senior American intelligence official has reported widespread rumors that Bandar was recruited by MI6, the British Secret Intelligence Service, before he finished his RAF training. Other sources, intimately familiar with the goings-on at BAE Systems, report that the "private" aerospace giant has a sales force made up almost exclusively of "lads" recruited to MI6 before their hires.
Whether or not these reports are accurate, Bandar certainly is a serious Anglophile. The best accounts of his adventures in England appear in the 2006 book, The Prince—The Secret Story of the World's Most Intriguing Royal (HarperCollins, New York), by William Simpson, a Cranwell classmate, and still-intimate pal of the Prince. Simpson, who wrote the book with the full cooperation of Bandar, recounted his friend's intimate ties with every occupant of 10 Downing Street.
"In London," Simpson reported, "Bandar would breeze into Number Ten with uninhibited panache. From Margaret Thatcher to John Major to Tony Blair, Bandar's access was extraordinary." By Prince Bandar's own account to Simpson about al-Yamamah, "When we first made the agreement, we had no contract. It was a handshake between me and Mrs. Thatcher in Ten Downing Street." It was months before the final details of the al-Yamamah deal were finalized, and the contracts signed. But even before the ink had dried, Britain had provided the initial delivery of Tornado jets—from the inventory of the RAF.
By the time the formal Memorandum of Understanding was signed between the British and Saudi defense ministers on Sept. 25, 1985, the original order had been expanded to 72 Tornado fighter jets and 30 Hawk training aircraft, along with other equipment and services. There have been two subsequent deals, al-Yamamah II and III, and al-Yamamah IV, worth as much as $40 billion in additional arms deliveries, is in the final stages.
Oil-For-Aircraft
The al-Yamamah deal was structured as a barter arrangement. While the Saudis did agree to pay cash for certain services and infrastructure construction under separate sub-contracts—and those cash payments went, in part, to "consulting fees" or bribes, including the $2 billion to Prince Bandar's accounts at Riggs Bank, and similar reported payments to the Chilean dictator Gen. Augusto Pinochet and the Dutch Royal Consort, Prince Bernhard — the essential contract involved the Saudi delivery of oil to Britain, in return for the fighter jets.
And here is where the story gets really interesting.
Saudi Arabia agreed to provide Britain with one tanker of oil per day, for the entire life of the al-Yamamah contracts. An oil tanker holds approximately 600,000 barrels of oil. BAE Systems began "official" delivery of the Tornado and Hawk planes to Saudi Arabia in 1989. BAE Systems now has approximately 5,000 employees inside Saudi Arabia, servicing the contract.
Is it possible to place a cash value on the oil deliveries to BAE Systems? According to sources familiar with the inner workings of al-Yamamah, much of the Saudi oil was sold on the international spot market at market value, through British Petroleum and Royal Dutch Shell.
EIR economist John Hoefle has done an in-depth charting of the financial features of the oil transactions, based on BP's own daily tracking of world oil prices on the open market. Using BP's average annual cost of a barrel of Saudi crude oil, Hoefle concluded that the total value of the oil sales, based on the value of the dollar at the time of delivery, was $125 billion. In current U.S. dollar terms, that total soars to $160 billion (see accompanying charts).
Based on the best available public records, the total sticker price on the military equipment and services provided by BAE Systems to Saudi Arabia, over the 22-year period to date, was approximately $80 billion. And those figures are inflated by billions of dollars in slush fund payouts. Indeed, the latest limited-damage scandal around al-Yamamah erupted in November 2006, when a Ministry of Defence document leaked out, providing the actual sticker price on the fighter jets. The figure confirmed the long-held suspicion that the prices of the jets had been jacked up by at least 40%.
BAE Systems, a crown jewel in the City of London financial/industrial structure, secured somewhere in the range of $80 billion in net profit from the arrangement—in league with BP and Royal Dutch Shell! Where did that money go, and what kinds of activities were financed with it? The answer to those questions, sources emphasize, holds the key to the power of Anglo-Dutch finance in the world today.
Prince Bandar's biographer and friend William Simpson certainly provided an insight into the inner workings of the al-Yamamah project: "Although al-Yamamah constitutes a highly unconventional way of doing business, its lucrative spin-offs are the by-product of a wholly political objective: a Saudi political objective and a British political objective. Al-Yamamah is, first and foremost, a political contract. Negotiated at the height of the Cold War, its unique structure has enabled the Saudis to purchase weapons from around the globe to fund the fight against Communism. Al-Yamamah money can be found in the clandestine purchase of Russian ordnance used in the expulsion of Qaddafi's troops from Chad. It can also be traced to arms bought from Egypt and other countries, and sent to the Mujahideen in Afghanistan fighting the Soviet occupying forces."
In effect, Prince Bandar's biographer confirms that al-Yamamah is the biggest pool of clandestine cash in history—protected by Her Majesty's Official Secrets Act and the even more impenetrable finances of the City of London and the offshore, unregulated financial havens under British dominion.
The Saudi Side of the Street
For its part, the Saudi Royal Family did not exactly get ripped off in the al-Yamamah deal. When the contract was signed in 1985, according to sources familiar with the arrangement, Saudi Arabia got an exemption from the Organization of Petroleum Exporting Countries (OPEC). The barter deal with BAE Systems did not come under their OPEC production quota. In other words, Saudi Arabia got OPEC approval to produce 600,000 barrels a day, above the OPEC ceiling, to make the arms purchases.
According to the Energy Information Administration, a branch of the U.S. Department of Energy, over the life of the al-Yamamah program, the average cost of a Saudi barrel of crude oil, delivered to tankers, was under $5 a barrel. At that price, the annual cost to the Saudis for the 600,000 barrels per day was $1.1 billion. Over the duration of the contract to date, the cost to the Saudis of the daily oil shipments was approximately $24.6 billion. The commercial value, in current dollars, as noted above, was $160 billion.
The Saudis have forged a crucial partnership with the Anglo-Dutch financial oligarchy, headquartered in the City of London, and protected by the British Crown. They have, in league with BAE Systems, Royal Dutch Shell, British Petroleum, and other City giants, established a private, offshore, hidden financial concentration that would have made the British East India Company managers of an earlier heyday of the British Empire, drool with envy.
At this moment, there is no way of calculating how much of that slush fund has been devoted to the clandestine wars and Anglo-American covert operations of the past two decades. Nor is it possible to estimate the multiplier effect of portions of those undisclosed, and unregulated funds having passed through the hedge funds of the Cayman Island, the Isle of Man, Gibraltar, Panama, and Switzerland.
What is clear, is that the BAE Systems scandal goes far beyond the $2 billion that allegedly found its way into the pockets of Prince Bandar. It is a scandal that goes to the heart of the power of Anglo-Dutch finance.
There is much, much more to unearth, now that the door has been slightly opened into what already appears to be the swindle of the century.
http://www.larouchepub.com/other/2007/3425scandal_of_cntry.html
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See also:
http://www.msnbc.msn.com/id/22644928/
http://www.cnn.com/2008/POLITICS/05/16/bush.saudi.arabia/
http://www.youtube.com/watch?v=goVa1l3KE60
http://www.kycbs.net/Oil-Stupid.htm
April 24, 2008
Senators want oil linked
to arms deal
Groups want arms sales halt unless
Gulf producers pump more petroleum
WASHINGTON - A group of senators called on President Bush on Thursday to halt billions of dollars in sophisticated arms sales to Saudi Arabia and several other Gulf oil producers unless they agree to pump more petroleum, reflecting growing frustration in Congress over soaring energy costs.
Separately, House Speaker Nancy Pelosi, D-Calif., said that Bush should stop putting 70,000 barrels of oil a day into the government's Strategic Petroleum Reserve, saying the oil would be better left in the market place to help lower prices. The Energy Department recently announced it is extending oil shipments into the reserve, which holds 700 million barrels, through the end of the year.
And Senate Majority Leader Harry Reid, D-Nev., said Thursday he had directed key committee chairmen to begin assembling a package of proposals aimed at addressing the growing impact that high gasoline and other energy prices are having on the economy. Reid declined to say what proposals were being considered. The plan is to bring a package to the Senate floor before Memorial Day.
'A two-way street'
In a letter to Bush, the senators noted that Saudi Arabia has dropped oil production by about 2 million barrels a day over the last three years as oil prices have soared well over $100 a barrel. Its current production of 8.5 million barrels a day is well below its stated capacity of 11 million barrels a day, the senators said.
"At a time when high energy prices are causing widespread anxiety among American households, we question the merit of rewarding members of OPEC with lucrative arms sales," the senators wrote.
"The Saudis have to understand that this is a two-way street," Sen. Charles Schumer, D-N.Y., said at a news conference. "We provide them weapons ... and then they rake us over the coals when it comes to oil."
Joining Schumer in the letter were Democratic Sens. Byron Dorgan of North Dakota, Mary Landrieu of Louisiana, Bob Casey of Pennsylvania and independent Sen. Bernie Sanders of Vermont.
At issue are administration plans to supply Saudi Arabia with $123 million worth of sophisticated precision-guided bomb technology as well as shipments of Patriot missile defense equipment worth $9.7 billion to the United Arab Emirates and a $1.7 billion deal with Kuwait to upgrade their missile systems.
The arms sales are part of an effort by the administration to boost the defenses of friendly Arab nations in the oil-rich Gulf region, particularly against any threat from Iran. Congress typically goes along with such arms deals. When the deals were announced late last year and last January, Congress had 30 days to reject them, but did not act...
http://www.msnbc.msn.com/id/24298840/
March 1, 2008
Airbus parent beats Boeing for
big U.S. Air Force contract
By Leslie Wayne, International Herald Tribune
WASHINGTON: The U.S. Air Force, in a stunning decision against Boeing, awarded a $40 billion contract for aerial refueling tankers Friday to a partnership between Northrop Grumman and the European parent of Airbus, putting a critical military contract partly into the hands of a foreign company.
The contract, one of the largest at the Pentagon, has the potential to grow to $100 billion. It is also a sign of the growing influence of foreign suppliers within the Pentagon and breaks a decades-long relationship with Boeing, which built the bulk of the existing tanker fleet and fought hard to land the new contract.
"This isn't an upset," said Loren Thompson, a military analyst at the Lexington Institute, a Washington-area research group. "It's an earthquake."
Under the contract, Northrop and the parent of Airbus, European Aeronautic Defense & Space, or EADS, would build a fleet of 179 planes, based on the existing Airbus 330, to provide in-air refueling to military aircraft, from fighter jets to cargo planes. It gives a huge lift to EADS, whose commercial aviation program has suffered a number of setbacks in recent years.
While final assembly of the craft would take place at an Airbus plant near Mobile, Alabama, parts would come from suppliers across the globe.
At a news conference, air force officials said the creation of domestic jobs was not a factor in the decision. In response to questions about possible negative reaction to the deal in Congress, General Arthur Lichte, head of the air force's air mobility command, said, "This will be an American tanker, flown by American airmen with an American flag on its tail and, every day, it will be saving American lives."
Reaction from some in Congress, however, was swift.
"We are outraged that this decision taps European Airbus and its foreign workers to provide a tanker to our American military," the delegation from Washington State said in a joint statement. Boeing planes are assembled outside Seattle. "This is a blow to the American aerospace industry, American workers and America's men and women in uniform."
For its part, Boeing, which had been considered the strong favorite to retain the contract, said it was "very disappointed" in the outcome. But it did not say whether it would file a formal protest - something General Michael Moseley, chief of staff of the air force, has said he hopes the losing bidder will not do because it would only further delay the tanker replacement program.
In its statement, Boeing said, "We believe that we offered the air force the best value and lowest risk tanker for its mission." The company added that only after a debriefing by the Pentagon would the company "make a decision concerning our possible options, keeping in mind at all times the impact to the warfighter and the nation."
A Boeing victory was considered so certain that many Wall Street analysts had already factored the contract into their economic forecasts for the company and led one senator, Kay Bailey Hutchison, Republican of Texas, to prematurely send out a press release praising Boeing for its victory.
The air force decision is also a surprise ending to a protracted contracting process that went on for nearly a decade and became mired in scandal and international politics. Senator John McCain, the presumptive Republican presidential candidate, had scuttled an earlier attempt by the air force to award the contract to Boeing, opening the door for the Northrop-Airbus bid.
McCain's campaign spokeswoman referred calls to his Senate office, which could not be reached for comment.
Norm Dicks, a Washington Democrat who is a member of the House Appropriations Committee Defense Subcommittee, said he was attending an anticipated victory party at Boeing's Washington headquarters when the mood suddenly darkened.
"Here we are in the middle of a recession and we give this to Airbus?" Dicks added. "That is not going to go down well."
Ronald Sugar, the chief executive of Northrop Grumman, said in a telephone interview that he expected members of Congress would have a "variety of views" depending on whether their districts would be gaining or losing jobs under the deal.
He said that 60 percent of the content of the new tanker would come from the United States and that the contract would create 2,000 jobs in Mobile and 25,000 overall in the United States.
"This is more about the capability that we will give to the kids fighting the wars and the cost to the taxpayer," he said.
Backing Sugar's view was Senator Richard Shelby, Republican of Alabama, who hailed the decision as "great news for Alabama."
The Alabama and Mississippi delegations had lobbied hard in Congress to polish the image of Airbus. In Paris, at the annual air shows, Airbus officials and these politicians proudly displayed the proposed European tanker offering and made the argument that if the United States wanted to sell its weapons to European countries, it should also open its doors to foreign suppliers....
Replacing these tankers has been the air force's top priority since 1996, when the government first proposed obtaining new planes. The first 179 tankers will be acquired at a pace of about 15 a year. But it is expected that, over time, nearly 400 new refueling planes will be needed, which could bring the program's total cost to $100 billion.
For more than a decade the air force's effort to modernize the fleet has been thwarted by global politics, Washington scandals and an aggressive attack by McCain, a member of the Senate Armed Services Committee.
In the end, a procurement scandal led to the departure of Philip Condit, the chief executive of Boeing, the resignation of James Roche as air force secretary and the imprisonment of two Boeing executives, one of whom had worked on the program as a Pentagon acquisition official.
The air force, short on cash and wanting to acquire the planes as fast as possible, proposed an arrangement to Congress in late 2001 under which the Pentagon would lease the Boeing 767s in a sole-source contract that would keep Boeing's aging 767 production line alive.
But just as the air force was about to sign that deal, it came under sharp attack from McCain, a former navy pilot. He denounced the deal as a sweetheart arrangement between Boeing and the air force that had been arranged with insufficient scrutiny and oversight, and that would shortchange the taxpayer.
Soon afterward, it was reported that the air force's No. 2 weapons buyer, Darleen Druyun, had been promised jobs for herself, her daughter and son-in-law in return for steering the tanker contract and billions of dollars of other air force business to Boeing. Soon after joining the company in a $250,000-a-year post, Druyun and Michael Sears, Boeing's former chief financial officer, pleaded guilty and received prison terms.
The weight of the scandal caused the deal to collapse in 2004 and opened the door to competition.
Each side spent millions to sharpen its proposal, hire lobbyists and former generals to argue their case and wage extensive advertising efforts in Washington and at military gatherings.
http://www.iht.com/articles/2008/03/01/business/eads.php
January 14, 2008
Bush Stops in Saudi Arabia
for Talks
Bush Visits Ally Saudi Arabia for Talks
With King After Touring Dubai
By ANNE GEARAN AP Diplomatic Writer
RIYADH, Saudi Arabia (AP) - President Bush, on his first visit to this oil-rich kingdom, delivered a major arms sale Monday to a key ally in a region where the U.S. casts neighboring Iran as a menace to stability.
Bush's talks with Saudi King Abdullah, which began over dinner and were continuing with late-night meetings, also were expected to cover peace between Israelis and Palestinians and democracy in the Middle East.
Coinciding with Bush's trip, the Bush administration in Washington notified Congress on Monday that it will offer Saudi Arabia the chance to buy sophisticated Joint Direct Attack Munitions or "smart bomb" technology and related equipment, the State Department said. The administration envisions the transfer of 900 of the precision-guided bomb kits, worth $123 million, that would give the kingdom's armed forces highly accurate targeting abilities.
The proposed deal follows notification of five other packages to Saudi Arabia, the United Arab Emirates and Kuwait, bringing to $11.5 billion the amount of advanced U.S. weaponry, including Patriot missiles, that the administration has announced it will provide to friendly Arab nations, State Department spokesman Sean McCormack said. Administration officials say the total amount of eventual sales as part of the Gulf Security Dialogue is estimated at $20 billion, a figure subject to actual purchases.
The arms packages are an important part of the U.S. strategy to bolster the defenses of oil-producing Gulf nations, such as Saudi Arabia, against threats from Iran. Saudi Arabia and other Gulf states, which have majority Sunni Muslim populations, harbor deep suspicions about Shiite Iran's apparent designs to establish itself as a major power.
Congress already has been briefed on all the packages, which also include the sale of the Navy's Littoral Combat system. Lawmakers mostly see the deals as critical to maintaining relations with war-on-terror allies. Some are opposed to the JDAMs portion out of concern that it gives Saudi Arabia the ability to attack Israel, but are unlikely to muster the two-thirds majority needed, within an allowed 30-day period, to block the sales....
http://abcnews.go.com/International/wireStory?id=4130306
October 11, 2006
BAE Systems wins $87M
contract at Pearl Harbor
By Stewart Yerton, Star-Bulletin
Ensuring the retention of more than 300 jobs at Pearl Harbor for most of the next decade, BAE Systems Inc.'s ship repair division has won a seven-year, $87 million contract from the U.S. Navy to repair ships at BAE's Hawaii Shipyard, the company said yesterday.
The contract covers maintenance of the 12 Navy ships stationed in Hawaii, as well as transient Navy ships that could stop in Hawaii for repairs while at sea, said John Kowalczyk, a spokesman for BAE Systems in Rockville, Md. It means continued employment for 170 BAE employees in Honolulu and for 150 to 170 contractors, Kowalczyk said .
Although BAE pegged the contract's value at $87 million, it actually could be worth as much as $270 million at the end of seven years, Kowalczyk said.
BAE Systems Inc. is the U.S. subsidiary of U.K.-based BAE Systems PLC.
The benefits of the contract go beyond the jobs it creates for BAE and its contractors, said Tom Smythe, military affairs coordinator for the Hawaii Department of Business, Economic Development & Tourism. Having the ships docked in Hawaii for repairs also means the crews will be stationed here during that time, which Smythe said is also a benefit for the local economy...
http://starbulletin.com/2006/10/11/business/story03.html
May 25, 2006
BAE turning toward U.S. as it
cuts 27-year tie to Airbus
Sale to EADS of 20% stake could shake up both companies
By Nicola Clark
PARIS: When BAE Systems, the British military contractor, announced last month that it was bowing out of its nearly 30-year relationship with Airbus, the split was greeted in Britain with shock, followed by nods of recognition of the kind that sometimes come when a long-married couple confide that they have grown apart.
The British, after all, had been lukewarm about the European commercial aircraft venture almost from the beginning. The country entered talks in the mid-1960s on joining the French-German consortium, but backed out in 1969 when the supersonic Concorde - which received more than £1 billion, now worth more than $1.9 billion, in British state aid - garnered only a handful of orders. A full decade passed before BAE Systems, then a state-owned company, joined Airbus, in 1979.
Its departure now could change not only BAE but also Airbus, where the ownership - and decision-making - structures are evolving.
BAE has never really seen itself as a builder of passenger planes. When Airbus was transformed into a corporation in 2000, BAE made clear that its interest in the company was financial and not strategic: The terms included an option for BAE to sell its 20 percent stake back to European Aeronautic Defense & Space, which owns the other 80 percent.
"The fact that BAE is selling its stake should not come as a surprise," Gustav Humbert, chief executive of Airbus, said last week. "This is a business decision, not an industrial one."
http://www.iht.com/articles/2006/05/25/business/bae.php?page=1
January 5, 2006
Norway pulls investments in seven multinationals over ethical concerns
Groups producing nuclear arms components
OSLO (AFP)
Norway has withdrawn investments of more than 500 million dollars (413.6 million euros) from seven multinational corporations, including Boeing and Honeywell of the US, due to ethical concerns over the groups' production of nuclear arms components, the government said on Thursday.
The five other companies are BAE Systems of Britain, Safran of France, Finmeccanica of Italy, and US groups Northrop Grumman and United Technologies.
The withdrawal follows a recommendation from Norway's Advisory Council on Ethics, which is tasked with monitoring the ethics of companies in which Norway places its massive state Pension Fund, formerly known as the Oil Fund.
Norway's finance minister asked the central bank, which manages the fund, to sell the holdings, worth 3.3 billion kroner (416.2 million euros, 502 million dollars). They were sold last year, Finance Minister Kristin Halvorsen told reporters on Thursday. "This does not mean that there won't be other companies (excluded)... Our work will continue," she stressed.
Norway, however, did not withdraw its stake in French oil group Total, in line with the Advisory Council's recommendation. Total has been criticised by several humanitarian aid groups for its controversial business dealings in Myanmar, formerly Burma, which is run by a military junta....
The Advisory Council said it saw "no direct link today between the human rights violations committed by the Myanmar regime and Total's activities in this country." The Norwegian Burma Committee said it was "very disappointed" by the decision. According to the most recent statistics available, the Norwegian state holds 0.679 percent of Total.
Norway's state Pension Fund, into which the state deposits its massive oil and gas revenues, is one of the richest funds in the world. At the end of September 2005, it was worth 1,281.1 billion kroner (161.4 billion euros, 195.2 billion dollars). The sheer size of the fund enables Norway to exert pressure on companies to ensure that their operations are ethical. Norway is the world's third-largest oil exporter behind Saudi Arabia and Russia.
The Scandinavian country has already withdrawn its stakes in 10 other companies, including Thales of France, European Aeronautic Defence and Space Company, and US groups General Dynamics, Lockheed Martin and Raytheon. They are accused of helping manufacture cluster bombs, devices which are particularly lethal for civilian populations. ----
http://nucnews.net/nucnews/2006nn/0601nn/060105nn.txt
June 27, 2005
Congressman has options
to cover legal costs
By: MARK WALKER - North County Times Staff Writer
If he wants, Rep. Randy "Duke" Cunningham can draw from the $635,000 in campaign funds he controls to pay legal bills arising from an investigation into his dealings with a Washington defense contractor.
Federal statute allows the embattled Republican lawmaker to spend that money on legal expenses, something a spokesman for the Federal Elections Commission said Monday happens from time to time.
Cunningham, who has not indicated how he will pay his legal bills, also has the option of setting up a legal defense fund. That option, in use by House Majority Leader Tom DeLay, who is battling ethics charges, would need approval from the House Committee on Standards of Official Conduct.
On Friday, the attorney hired by Cunningham refused to comment on whether a legal defense fund would be established. Cunningham represents the 50th Congressional District, which includes much of North County....
Through March 31, the Friends of Duke Cunningham committee had $601,903 on hand with no debts owed, according to its latest report on file with the Federal Elections Commission....
It has become increasingly common for members of Congress to create their own political action committees to make contributions to other members' campaigns and to those running for the first time, according to Larry Noble, executive director of the nonpartisan, nonprofit Center for Responsive Politics in Washington, which tracks campaign spending.
Among the contributors to American Prosperity in 2004 was a political action committee controlled by Wade's company, MZM Inc., which gave it $2,500 in June and another $2,500 in September.
In its latest filing, Friends of Duke Cunningham reported raising $23,500 coming from individual contributors through March 31 and $62,500 from political action committees between Jan. 1 and May 31.
Only six of the 38 individual contributors had San Diego County addresses. The rest had Washington or surrounding area addresses and appeared associated with firms that do business with the federal government, according to the elections commission filing....
Among the 25 contributions from political action committees, the most came from the BAE Systems North America Inc., which gave $4,000 on April 22 and another $5,000 on April 28, according the elections commission filing.
BAE Systems is a worldwide high-tech information and security firm with its North American headquarters in McClean, Va....
Contributions to a legal defense fund that Cunningham could establish are limited to $5,000 a year per individual, union or corporation.
Wade has refused repeated interview requests.
A federal investigation into the Cunningham-Wade relationship would most likely focus on Wade's 2003 purchase of Cunningham's Del Mar Heights home for $1.65 million, and its resale of 11 months later for $700,000 less than what he paid Cunningham.
The congressman now serving in his eighth term of office also has acknowledged living aboard Wade's boat named the "Duke-Stir" at a Potomac River marina. Cunningham said in his statement last week that he had paid more than $13,000 in dock and maintenance fees in lieu of traditional rent.
Contact staff writer Mark Walker at (760) 740-3529 or mlwalker@nctimes.com .
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November 11, 2003
BAE System's Dirty Dealings
by Sasha Lilley, Special to CorpWatch
It sounds like the stuff of pulp fiction: The UK's largest armaments producer running a £20 million ($33.4 million) slush fund to finance prostitutes, gambling trips, yachts, sports cars, and more for its most important clients the Saudi royal family and their intermediaries, greasing the wheels of the largest business deal in UK history.
These are the accusations made last month by a former employee of weapons giant BAE Systems. And evidence has surfaced that members of the British government were aware of the bribe arrangement, but looked the other way.
BAE Systems, formerly known as British Aerospace, is one of the world's top arms producers. It manufactures warplanes, avionics, submarines, surface ships, radar, electronics, and guided weapons systems, generating annual sales of £12 billion ($20 billion) in 130 countries. The arms giant was formed as a nationalized British defense corporation in 1977, which was subsequently privatized in the early 1980s, and changed its name to BAE when British Aerospace merged with Marconi Electronic Systems in 1999.
BAE Systems' North American branch has an unusual special relationship with the Pentagon where it is treated as a domestic arms company. According to Ian Prichard of the British Campaign Against Arms Trade (CAAT), "BAES North America appears to be virtually a separate company - even top UK executives are not privy to the more sensitive work carried out by 'their' company in the US."
For years the company has been accused of selling arms to impoverished and dictatorial regimes, polluting the environment, and has been dogged for years by allegations of corrupt dealings.
Now those allegations have exploded into the open. Revelations point to BAE's provision of enticements to the Saudis over a fifteen year period, starting in the late 1980s, using a front company Robert Lee International (RLI), to divert funds to the arms clients and their middlemen.
Among other allegations, RLI procured prostitutes for visiting Saudi officials and bought houses for mistresses, while an internal BAE statement reportedly refers to "sex and bondage with Saudi princes". According to documents published by The Guardian, the British government's Serious Fraud Office (SFO) alerted the Ministry of Defense of the possible involvement of BAE's chairman Sir Richard Evans in the bribe scheme, but the Ministry of Defense did nothing.
BAE Systems' chief executive Mike Turner didn't deny the slush fund charges. At a press conference following the revelations, he stated, "They are old allegations and they are old hat. They are history." Turner added, "Everything we do is legal and that is all I am prepared to say. Whatever the law is, we are legal."
Al-Yamamah
The slush fund allegations are tied to the biggest export agreement in British history - the Al-Yamamah (The Dove) arms deals that the British government signed with the Saudi royal family. BAE, then known as British Aerospace, was to sell the Saudis 72 Tornado and 30 Hawk advanced fighter-bombers along with other tranches of military hardware.
In an unusual barter arrangement between the two governments, the Saudis were to purchase the armaments in payments of oil, over an unspecified period of time. Over the last two and a half decades, the deals have amounted to the sale of 96 Tornado Fighters and more than 100 Hawk jets and other training aircraft totaling at least £20 billion ($33.4 billion), with BAE taking in an estimated £1.5 billion a year. BAE is currently in negotiations with the Saudis for a further extension of the Al-Yamamah deal.
The first Al-Yamamah deal was signed in 1986, when the Saudis' main armaments supplier, the United States, was blocked from selling arms to their longtime ally by an historic Congressional vote. The House of Saud turned to British weapons manufacturers instead. The Saudis were happy to reduce their dependence on the US, while the UK saw the petrodollar-rich Saudis as a long term bonanza. A second deal between the two governments was signed in 1988. Some analysts believe that Al-Yamamah kept BAE afloat through the 1990s when the company was facing financial difficulties.
Rotten from the Beginning
While armaments transactions are known to be fraught with bribery, British journalist and arms trade opponent Gideon Burrows states that Al-Yamamah "may be the world's most corrupt deal". And while the scandal around allegations of the BAE slush fund are particularly lurid, accusations of corruption date back to the creation of Al-Yamamah I and II, as they've come to be known.
According to former CIA operative Robert Baer much of the money that BAE registered as earnings from Al-Yamamah was earmarked from its inception for kickbacks to members of the Saudi royal family and other intermediaries. "[Al-Yamamah] was a huge commission-generating machine. British Aerospace overcharged for its hardware and spare parts, with the difference going to commissions."
The Saudis are not the only ones who may have profited from Al-Yamamah kickbacks. In 1994 MP Tam Dalyell accused the son of then Prime Minister Margaret Thatcher of receiving a £12 million commission from the Al-Yamamah deal, but the government declined to investigate the charges against Mark Thatcher. Less fortunate was British Defense Procurement Minister Jonathan Aiken who played a key role in setting up Al-Yamamah II. He was imprisoned in 1993 for letting the Saudis pick up his tab at the Paris Ritz.
The British government and BAE have been criticized from the start by arms watchdog groups for selling weapons to a despotic, theocratic regime. Amnesty International characterizes Saudi Arabia, the world's top arms buyer, as a major violator of human rights: "Summary, unfair and secret trials are the norm in Saudi Arabia and torture is a common practice to extract confessions from suspects. Defendants facing capital charge are invariably convicted after trials which lack the most basic standards of fairness."
A 1995 Channel 4 "Dispatches" documentary revealed that BAE tried to sell electric shock batons to Saudi Arabia two years earlier, which could be used for the torture of prisoners.
Hawk Jets
If the current allegations of the Saudi slush fund weren't bad enough, BAE is in the center of another storm of controversy. This summer, BAE finally clinched a highly contentious deal to sell 66 Hawk jets to India - for which the poverty-stricken nation paid £1billion ($1.7 billion).
The agreement, which threatened to fall through a number of times, was helped along by the intervention of the British government. In 2002, in the midst of heightened tensions between India and Pakistan over Kashmir that threatened to turn into a nuclear war, British Prime Minister Tony Blair visited the two countries ostensibly on a peace-making mission. However, as the Indian media revealed, he used the visit as an opportunity to promote the sale of BAE Systems Hawk jets, as did his Foreign Secretary Geoff Hoon later in the year.
"The same time that the prime minister and the foreign secretary have been over in India trying to play a role as a peace broker in the Kashmir crisis, we've also in effect been acting as an arms broker," says Andy McLean of the London-based think tank Saferworld. "And the government has been directly pushing the sale of jets which we will know could be used both directly in Kashmir and also will be used to train Indian pilots to fly much more deadly fighter jets which could also be used in Kashmir and potentially which could be used to carry nuclear weapons."
McLean says that BAE Systems' dealings in India are not an anomaly. "The Hawk jet [has] almost become synonymous in the UK with scandal in the arms trade," he says. "It was Hawk jets that were licensed for export to Indonesia and were then found after years of protestation from human rights groups to have been used to intimate the civilian population in East Timor. This was denied by the government for years but was then actually admitted by the Indonesian armed forces."
The British government also allowed export licenses for the sale of BAE's Hawk jets to Zimbabwe, which is was later forced to revoke Zimbabwe became involved in the conflict in the Democratic Republic of the Congo. BAE has targeted other poor African countries for arms sales. "It was also British Aerospace which manufactured the military radar system that has cost the Tanzania people £28 million ($46.8 million) that could have been used on providing fresh water and vaccinations for the population there," says McLean.
Government Role
Busines