Wednesday, July 11, 2012

For Ghetto Nerds and Grognards: Just Like a Good Iron Monger War Profiteer, Pratt & Whitney is Caught Selling U.S. Military Technology to China

The Canadian arm of the aircraft engine manufacturer Pratt & Whitney closed a six-year U.S. government probe last week by admitting that it helped China produce its first modern attack helicopter, a serious violation of U.S. export laws that drew a multimillion dollar fine. 
At the same time it was helping China, the company was separately earning huge fees from contracts with the Pentagon, including some in which it was building weapons meant to ensure that America can maintain decisive military superiority over China's rising military might. 
The Chinese helicopter that benefited from Pratt's engines and related computer software, now in production, comes outfitted with 30 mm cannons, anti-tank guided missiles, air-to-air missiles and unguided rockets. "This case is a clear example of how the illegal export of sensitive technology reduces the advantages our military currently possesses," Immigration and Customs Enforcement Director John Morton said in a statement released on June 28. 
The events are once again raising questions about the circumstances under which major defense contractors might be barred from government work. Independent watchdogs have long complained that few such firms have been barred or suspended, even for egregious lawbreaking, such as supplying armaments or related equipment to a hypothetical adversary. 
Nothing in the settlement agreement, in which Pratt & Whitney and two related companies, United Technologies and Hamilton Sundstrand agreed to pay a total of $75 million for multiple violations of export rules, directly threatens Pratt's existing or future government contracting.
Gangster Capitalist Mitt Romney and his handlers are trying to massage away the difference between "outsourcing" and "offshoring" in order to protect the 2012 Republican Presidential nominee's reputation as a defender of the common man and the American dream.  

Regardless of this exercise in Orwellian newspeak, we are reminded once more of how corporations are sociopathic, and not at all beholden to notions of patriotism, nationalism, or the Common Good.

More from the Atlantic:
When Hamilton finally discovered the military use of its software in Feb. 2004, it shut down its production in less than a week. Pratt, still holding out hope for the large civilian helicopter contract, picked up where Hamilton Sundstrand left off and exported its own versions of the software to China through June 2005. 
Prosecutors, in a court filing, said the company turned a "blind eye" to any doubts because it was hungry to earn up to $2 billion from the civilian program. Canadian authorities, after being told about the parallel Z10C helicopter, approved the export of 10 engines. 
Pratt & Whitney's Canadian subsidiary next asked its sister subsidiary Hamilton Sundstrand -- headquartered in the United States -- to write the software needed to control the engines, without saying that the purpose was to equip a military helicopter. From January 2002 to October 2003, Hamilton Sundstrand exported 12 versions of the software to Pratt & Whitney, which sent six of those on to China for use in the development model of the Z10 helicopter, according to the settlement agreement. 
United Technologies made a limited disclosure about its involvement to the State Department in 2006, after an institutional investor said it was researching the company's role in helping China's military and threatened to disinvest. The company has now admitted that disclosure -- which claimed the company believed at the outset there were dual civilian and military helicopter programs -- was inaccurate. 
In the end, Pratt got little more for its troubles than a federal probe. In early 2006, China's Aviation Industry Corporation told Pratt & Whitney the supposedly parallel civilian helicopter development would be scrapped. Instead, China said it would instead build a much larger civilian helicopter, too large for the engines built by Pratt & Whitney.
According to the Justice Department's statement announcing the settlement, the first batches of the Z10 attack helicopter were delivered to the People's Liberation Army of China in 2009 and 2010.
China is a (rising) superpower. It is not at all outside of the realm of reason or possibility that the United States and her allies will be in a conflict with China in the near future. Yet, an American company sells them the software and technology necessary, in violation of the law, to make their war machine more effective at killing American soldiers, airmen, sailors, and marines.

There will be few if any consequences for this act of treason. The issue is too technical for the public to latch onto as presently framed; political elites live in a revolving door universe where they move seamlessly from the public to the private sector; and the military-industrial complex has so much money and influence over American life that few folks have the moral fortitude or personal integrity to speak up against it.

Apparently, such trading of technology and secrets between "rival" nations by their corporate actors in order to profit maximize is not at all new or novel. 

For example, I am finally finishing up Adam Hochschild's World War One social history To End All Wars. There he details a similar story of corporate self-interest working contrary to the public good. 

Until reading  To End All Wars, I did not know that during World War One German and British companies traded weapons and material with each other while the citizens of those respective countries were simultaneously killing each another by the millions.

Henry Ford was a notorious anti-Semite and Nazi sympathizer. His companies made arms and equipment for the Allies while also providing material support to the Nazis during World War 2.

After the horrors of World War One, the Nye Report on the "merchants of death" concluded that arms manufacturers had a vested interest in war, would act to encourage conflict, and were agents who had little commitment to peace, international stability, or global order. If given the chance, the iron mongers would create and encourage war and killing in order to fatten their bottom line and the shareholders' wallets. 

The corporation is a sociopathic entity. Consequently, if the corporation was a person it would likely be a serial killer. It has been decades since what was good for General Electric was good for Main Street. Ironically, many Americans--especially conservatives where such a belief is held with religious zeal--take this sentiment to still be true.

If the modern corporation is indeed sociopathic, would it not follow that its CEO's and managers are similarly inclined? Why does this not automatically disqualify a candidate like Mitt Romney as a potential protector of the general welfare and steward of our national prosperity?


OTB said...

As I understand it, much of what Romney and Bain did was put money into firms on the brink of bankruptcy, sometimes saving them and other times keeping them alive for years longer than otherwise possible.

Isn't this, with a slightly altered time frame, similar to what Obama did with GM and many green companies?

Anonymous said...

In our think tank we have noticed the sales of drones to local governments . American workers are equally as guilty as their corporate owners for working in these factories making these weapons just like our troops who mercenaries for volunteering in our arm forces

At some point we must pressure the workers and union leadership who allowed themselves to be part of our nations's war machines

Yes let's indict corporations and their workers .,,

Anonymous said...

No one should escape scrutiny


chaunceydevega said...

@Anon. Romney's company would tear apart companies and profit maximize by outsourcing and down-scaling them. In his tenure he destroyed tens of thousands of jobs in order to make a profit. I am all for making money; but that type of destructive casino capitalism should be subject to scrutiny and he should have to explain himself--along with the offshore money he is hiding.

Anonymous said...

Of course they encourage destruction if they profit from it. How else would all of those guns and assault rifles find their way onto our urban streets? Why we wouldn't demand complete fianacial transparancy for the leaders of industry is self-defeating.

OTB said...


What offshore money is Romney hiding?

If it's known, he's not doing much of a job of hiding it.

chaunceydevega said...

@OTB. Not hard to find. Google is your friend:

OTB said...

Thanks you for the link, although the article seems more about innuendo than detail.
What has Romney done in this regard that is illegal, immoral, out of character for someone of his means, or fattening?

Throcky said...

@Anon You assume individual workers have a choice as to what they do. For most workers the choice is between the assembly line and the unemployment line. This is especially true today with the great rise in unemployment, meaning that a replacement job is much harder to find than usual. Unions today aren't strong enough to defend workers' wages and benefits, much less strong enough to go on the offensive and oppose the war. Why are workers and unions in this position? Because businesses want it this way.