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Ge military arms Original Source Link: (May no longer be active)
http://www.motherjones.com/arms/ge.htmlhttp://www.motherjones.com/arms/ge.html
General Electric
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Primary military product: Jet engines
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Annual Sales: $1.7 billion in 1996 for military sales
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Primary customers: Egypt, Israel, Kuwait
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Famous/infamous for: Political clout as a media giant and billion-dollar arms dealer
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Major campaign contributions (1997-98): $1,215,550 from General Electric and related PACs
As both a billion-dollar arms dealer and owner of the NBC network, America's General Electric is uniquely positioned to profit from the new arms race -- and simultaneously to influence what the public knows about the weapons buildup.
GE had aircraft-engine sales in excess of $2 billion during 1996. That's not an insubstantial amount -- but it's only 2 percent of the corporate giant's $79.1 billion in overall sales that year. GE remains one of the world's three largest jet-engine makers (besides Pratt & Whitney and Rolls-Royce PLC), and subcontracts extensively to Boeing, Lockheed Martin, and other leading aircraft and helicopter manufacturers.
GE's big-money deals with Egypt, Israel, and Kuwait have been aided by the Clinton administration's arms-friendly policies. Two deals with Kuwait were arranged through the Pentagon's Foreign Military Sales (FMS) program, a convenient, tax-funded brokerage.
The U.S. government is quite helpful in cutting buyer costs and marketing arms overseas for GE and other weapons makers. The Clinton administration has continued to waive "recoupment" fees (which compensate manufacturers for certain costs of developing a given weapon) to save buyers money. More importantly, though, in December 1995 the government created the $15 billion Defense Export Loan Guarantee (DELG) program.
The DELG program guarantees loans for sales of U.S. military equipment to 39 countries, including 10 eastern and central European nations. This funding is in addition to established corporate welfare such as the Export-Import Bank and Overseas Private Investment Corporation, whose loans and insurance cushion the risk and financial exposure of buyers and sellers alike.
More troublingly, President Clinton's long-awaited Presidential Directive 41, issued in February 1995, argued that arms sales were essential for preserving U.S. industrial jobs. As such, it ordered the U.S. diplomatic corps to become directly involved in boosting sales.
The directive means that diplomats posted overseas are graded for promotion partly on how helpful they have been in marketing American weaponry to host countries. The U.S. military provides aircraft for transporting goods to air and arms shows abroad, where U.S. diplomats do the hard sell like traveling salesmen.
In GE's case, as with many other companies, success at home and abroad don't necessarily translate into U.S. jobs; rather, layoffs have followed. GE's Lynn, Massachusetts, plant contracted with a company in the Netherlands to make rear flaps and seals for F-110s. This "job export" helped close a sale of helicopter engines -- helping add 15 more workers to the tally of 4,000 who have been laid off at the plant since 1986.
GE's defense holdings, media interests, and sheer overall size give it huge political clout. Beginning in January 1997, the company's two PACs shoveled $729,900 into Democratic and Republican coffers in just 18 months -- a lot of money to the parties, but a pittance in GE's multibillion-dollar scheme of things. (Incidentally, GE's friendliness with the Clinton administration goes way back: In 1994, Brian H. Rowe, then chairman of General Electric Aircraft Engines, accompanied then-Secretary of Commerce Ron Brown on a junket to Russia.)
-- Geov Parrish
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A late-1994 deal with Egypt for 12 McDonnell Douglas AH-64 Apache helicopters and six GE T700 engines was worth $318 million; a 1997 deal with Israel for 30 GE turbine engines -- along with 15 of Sikorsky's UH-60 Black Hawk helicopters -- brought the two companies $200 million. But the real money has been in Kuwait: In 1994 GE engines were part of a package (including Apaches, 500 Hughes/Rockwell Hellfire missiles, and 13,000 Hydra-70 rockets) worth $692 million. In 1997 Kuwait followed with an order for more spare GE engines, 16 Apaches, 384 Hellfire missiles, two spare launchers, and assorted knickknacks for a cool $800 million.
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