"Bailout for Boeing"

E-Mails Detail Air Force Push for Boeing Deal

Pentagon Official Called Proposed Lease of Tankers a 'Bailout,' Report Finds

By R. Jeffrey Smith

Washington Post Staff Writer
Tuesday, June 7, 2005; Page A01

For the past three years, the Air Force has described its $30 billion proposal to convert passenger planes into military refueling tankers and lease them from Boeing Co. as an efficient way to obtain aircraft the military urgently needs.

But a very different account of the deal is shown in an August 2002 internal e-mail exchange among four senior Pentagon officials.

"We all know that this is a bailout for Boeing," Ronald G. Garant, an official of the Pentagon comptroller's office, said in a message to two others in his office and then-Deputy Undersecretary of Defense Wayne A. Schroeder. "Why don't we just bite the bullet," he asked, and handle the acquisition like the procurement of a 1970s-era aircraft -- by squeezing the manufacturer to provide a better tanker at a decent cost?