September 2003 | Hightower Lowdown

Greasing the Skids for Corporate Welfare

by Jim Hightower

For Boeing Inc., it was a steal of a deal, wrapped in the flag and delivered on a silver platter.

The deal, initiated by Boeing lobbyists shortly after the September 11 terrorist attacks, lets the world’s largest airplane maker lease 100 of its commercial jets to the Air Force for conversion into refueling tankers. The lease pays a sweet $20 billion to Boeing — way more than the Air Force would pay simply to buy the tankers. It was a closed-door deal — done without competing bids and without congressional hearings or a vote. Oh...it also includes a 15 percent profit for Boeing — triple what it makes selling commercial planes.

How did this greasy gob of corporate welfare come about? Business Week magazine recently followed the lobbying trail. First, Boeing went to the top. Having just moved its corporate headquarters to Illinois, home state of House Speaker Dennis Hastert, its lobbyists quickly signed up Hastert, and he quietly slipped the arrangement into the Pentagon appropriations bill.

But the White House budget office balked, calling the costly lease scheme "irresponsible." So, Boeing’s lobbyists, Hastert’s office, and the Air Force agreed to a bit of Enron accounting to make the lease appear less costly than it is. In other words, they rigged the numbers.

Then they lobbied. Boeing spends some $6 million a year on lobbyists. It’s also a $2 million annual political contributor (including having given $100,000 to help pay for Bush’s inaugural festivities), so it has lots of insider clout.

Hastert himself worked the White House and got private sessions to pitch the lease directly to George W. After one of these sessions, Bush turned to his chief of staff and said: "Andy, let’s get it done."

Did I mention that shortly after the deal was done, Boeing hired the Air Force procurement official who had negotiated this taxpayer giveaway? And that, my friends, is how corporate welfare gets delivered in Washington.

Jim Hightower is a columnist and author. To subscribe to The Hightower Lowdown, send $15, and your name, and address to: Lowdown, P.O. Box 20596, New York, NY 10011. Visit his web site for more info.

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