Lawmakers Urge DoD To Deny European Company Defense Contract

By Laura Smith - University of New Mexico/Talk Radio News Service

A bipartisan collection of lawmakers urged the Department of Defense Wednesday not to award a military contract to European based aviation company Airbus following a recent World Trade Organization (WTO) ruling that the company received illegal subsidies from the European Union.

“We need fair competition with fair rules. [The] Department of Defense should not favor Airbus more than the WTO does. This is not a French government decision, this is a U.S. government decision,” Sen. Sam Brownback (R-KS) said.

Airbus is competing for a $40 billion contract from the Air Force against U.S. based manufacturer Boeing to replace aerial refueling tankers. The Department of Defense has said in September that they won’t consider the ruling by the WTO that Airbus received illegal subsidies.

Lawmakers, such as Brownback, Sen. Patty Murray (D-WA) and Sen. Kit Bond (R-MO), are asking the Department of Defense to “level the playing field.”

"Airbus and the European Union have refused to allow fair competition," charged Murray. "They use the Aerospace industry as a jobs program and they use billions of dollars in illegal launch aid to fund it. They don’t even require Airbus to repay the subsidies if the aircraft does unsuccessful. So it’s no risk, all reward for the company."

“We can’t afford to undercut American companies," added Bond. "We need a fair competition and a level playing field for American workers and American companies.”

Former Defense Secretary Optimistic That U.S.-Russia Summit Will Produce Renewed Ties

By Celia Canon- Talk Radio News Service

As the U.S-Russia summit from July 6th-8th nears, former Secretary of Defense William Cohen, who spoke at the Center for American Progress Thursday, delivered an optimistic message on the chances of cooperation between the two nations based on goals that both share.

“The distrust is long, it’s deep, but in my opinion it’s not irresponsible... [President Obama] has to decide what the nature of our relationship is going to be with Russia. He has to identify 5 or 6 areas of potential cooperation,” said Cohen.

Russian political experts and Washington think-tanks alike believe the upcoming summit could produce a renewal in Russo-American ties.

Cohen and Dr. Samuel Charap, a Fellow at the Center for American Progress, identified six points of common interest between the U.S. and Russia: Arms control and non-proliferation of weapons of mass destruction, stability and security for the former Soviet region, the fight against violent extremism, the introduction of Russia to Western organizations such as the WTO, energy conservation, and the health and wellness of the two populations.

On the scheduled expiration of START, ratified by Russia and the United States in 1991 to achieve a dramatic reduction in strategic forces, Cohen said “If President Obama and his counterparts are dedicated to doing that [complete the renewal of START by the end of the year], it’s achievable.”

Cohen reiterated the importance of Russia’s role in foreign affairs, indicating that “the non proliferation of weapons of mass destruction: we both have interests in that; curbing Iranian and North Korean nuclear ambitions. Frankly I don’t really think we will be able to solve Iran’s ambitions for nuclear weapons capability without the help of Russia. Russia will have far more leverage than we will. The question is are they going to be wiling to exercise that leverage in their dealings with Iran. They have serious commercial interests in Iran...”

Charap agreed with Cohen that the U.S. should include Russia in international organizations.

“The administration's policies should be guided by the long term goal of integrating Russia into western and other international institutions. integration in these structures, rather than isolation from them is in the U.S national interest because they require greater accountability,” said Charap.

In addition to national security issues, Cohen also discussed economic benefits of renewed ties between the two nations.

“[Russians] need to have Western investment and it has not exactly been a hospitable environment for Western investment. There are serious questions remaining concerning the rule of law... and safe investment,” said Cohen, adding that “The U.S should encourage the development of a democratic Russia that observes the universal values of human rights, political pluralism and the rule of law” in order to encourage foreign direct investment.

Pharmaceuticals may help Russia enter WTO

According to James N. Class, assistant vice president of international affairs at the Pharmaceutical Research and Manufacturers of America, Russia's acceptance into the World Trade Organization may be aided by pharmaceuticals.

During the Soviet era, Russia had a pharmaceutical industry that provided generic versions of Western drugs. After the fall of the Soviet Union, the status of these factories came into question. "You have 7,00 factories that need something to do," said Class. While many of these factories failed to meet Good Manufacturing Practices (GMP), then President Vladimir Putin made a 2004 statement in favor of meeting a better standard of GMP that put national treatment and WTO ascension on the table.

Research and development (R&D) for medicine has not yet been significantly affected by globalization, leaving the U.S. with 79.5% of the R&D market. However, Russia's status as an emerging market can help draw R&D to the country, since populations without a history of heavy pharmaceutical use are considered better for clinical testing. Once clinical testing is brought to an emerging economy, it is possible to increase funding for academic research centers. An increase of R&D funding will benefit Russia by stimulating their industries, addressing security concerns, and by giving Russia the means to stop buying overpriced generics from other European countries Class explained.

Class concluded that there are several factors that are blocking Russia's ascension to the WTO. The efforts have met with domestic resistance at home and the geopolitical situation with Georgia has stalled WTO Working Party meetings that would make the ascension possible. Still, there is a belief that meetings with the Working Party will resume in November, thus removing one of Russia's obstacles.