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November 29, 2010

Comments

Alex

He railed at British anti-corruption investigators, who had had the 'idiocy' of almost scuttling the Al-Yamama deal with Saudi Arabia."

Like the prime minister, then. I can also think of Tories who thought the case was a plot by crypto communists to bankrupt BAE and destroy our defences.

(Irony is entirely up to you)

john b

But why, other than him being an archetypal British Brute, would he think like this?

Because it's trivially true. If the UK had no laws against overseas corruption, UK companies would win more overseas business. When the UK had no laws against overseas corruption, UK companies *did* win more overseas business.

When we passed laws against overseas corruption, that was a moral decision. The government decided that the negative effects of corruption on the people who have to actually live in developing countries are so serious that it would be morally wrong for British people to continue to prosper from it.

...which is all well and good as far as it goes, although doesn't quite explain why in Acceptable Public Discourse "the interests of British workers should be sacrificed to help people living in developing countries" can be applied to bribery but not to immigration.

Andy and his grizzled-expat types also have a completely consistent and coherent position on this, which is "the UK government's job is to protect British people, fuck everyone else". See: France.

ajay

Putting a cynical hat on, you could argue that BAE corruption in particular is bad for Britain too. BAE basically has two more or less secure markets for its defence products: the British armed forces, whom it can blackmail (with threats of lost jobs, etc) and the Middle East, whom it can bribe. If it couldn't rely on bribery, it would only be able to sell to the home market - which isn't really big enough to be lucrative. Without bribery, in other words, BAE's defence business would go under. (Excluding the GD Land business in the US, which hasn't been BAE-owned long enough to be corrupted, and which is American enough to be allowed to compete on equal terms with LockMart and the others.)

Now, BAE's defence products are generally more expensive, slower to arrive, and significantly inferior to those of its foreign rivals. Without BAE, the British armed forces would be forced to make do with cheaper and better equipment from abroad. And without bribery, no BAE.
QED.

john b

Hang on.

US arms manufacturers, although the government takes a creditable attitude to foreign bribery, exist to sell overpriced shit which doesn't work to the US government in exchange for massive institutionalised corruption. That's why we call it the military-industrial complex.

EADS follows a similar business model to BAe, but with a different set of former colonies and protectorates. Airbus has good products which it sells on a fairly straight basis (well, if you exclude the mysteriously profitable deals it does with the Francophone developing world), but the EADS arms business is at least as much of a racket as the BAe arms business.

So we buy our arms from who exactly, if not BAe or someone who's just as bad? While I accept that Russia and China do offer cost-effective solutions, I can't help but think there might be some kind of sovereign risk thing involved there...

ajay

Steady on there john. The US arms industry produces quite a lot of stuff that is better and/or (normally and) cheaper than the products of either BAE or the European industry. Chinook vs Merlin, Apache vs Tiger, C-130/C-17 vs A400M, Typhoon vs F-22, Reaper vs, well, nothing, E-3 vs (god help us) Nimrod AEW, P-8 vs Nimrod MRA4, Wildcat vs Blackhawk. All of those are clear wins for the US product on either quality, price or both, and that's just in airframes.
I'm not endorsing a Buy US Forever policy, but there's a lot of areas there in which the BAE First procurement approach has wasted vast amounts of cash and produced an inferior product.

Alex

P-8 isn't flying yet...

ajay

Yes it is, it's in flight test and on track for IOC in 2013.
Nimrod 2000 (oh, sorry, Nimrod MRA4), which isn't flying, at least not any more, was "on track" for IOC (nine aircraft, not 21) in late 2012.

john b

Hmm. The US arms industry produces *for export* ... etc. Most American commentators seem to think the US government gets dicked just as badly by Boeing and Lockheed as the UK government does by BAe.

I don't know enough about military procurement to know the answer to "who rorts the most at home" questions, but on reflection, I'd probably add the US to the "cheaper arms with sovereign risk pile", just as I'd add anyone abroad buying BAe's kit.

So sure, if Boeing's better value-for-money than MIG, then bring it on once we've decided we're not going to do anything domestically, but don't pretend that the two are any different.

ajay

john: the sovereign risk issue is a non-issue. Most of the kit that BAE, and for that matter the European industry, produces contains large amounts of US components. We simply do not have the option, for most sophisticated equipment, of doing something without critical US input. We certainly don't have the option in Britain of doing something without foreign input. We can't even produce a working assault rifle without foreign input. (The SA80A2 is an SA80A1 that has been rebuilt by Heckler & Koch at vast expense.)

Look at the MRA4. What was its planned weapons fit? Mk 41 (made in the US); Stingray (UK); Harpoon (US); Maverick (US); Storm Shadow (MBDA, so UK/France/Italy). Sonobuoys made by Ultra (a UK company) in its USSC factory in Columbia, SC. Searchwater radar from Thales Defence. Glass cockpit from Airbus. Tactical systems developed by a BAE/Boeing collaboration. Optical turret from Northrop Grumman.

Take out everything US on that, and it could probably just about have flown, but that's it.

Also, American commentators are correct that Boeing and LockMart are both dodgy and tend to pad their bids. But, even with padding, the kit still tends to come out cheaper, for economy-of-scale reasons if nothing else. Not always; but often. (The USAF KC-X programme has been every bit as horrible as FSTA if not worse.) The comparison is not between buying from Boeing and buying from an honest supplier. The choice is between buying from Boeing and buying from BAE.

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