Reidblog [The Reid Report blog]

Labels: economic crisis, jobs, u.s. economy

• McCain and his job-killing machine

Labels: 2008 election, Barack Obama, DHL, jobs, John McCain, Ohio, presidential candidates, u.s. economy

By Michael D. Shear - LIMA, Ohio -- Five years ago, John McCain's campaign manager, Rick Davis, lobbied on behalf of German shipping giant DHL Express, whose purchase of Airborne Express meant a new corporate boss for thousands of residents in Wilmington, Ohio.

Now, DHL wants to stop using the Wilmington airport as a hub, something that could cost thousands of jobs. And today, McCain will meet with some of the people who could be laid off.

He is scheduled to gather with about two dozen local officials and company employees, a meeting that was supposed to highlight McCain's concern about the faltering economy in an important election-year swing state.

But thanks to the Cleveland Plain Dealer, which this week wrote about Davis' 2003 lobbying efforts on behalf of DHL, the meeting has invited some unwelcome attention for the campaign.

The Plain Dealer reported that McCain himself argued on behalf of the merger in 2003 after concerns were raised by fellow senators about foreign ownership of the shipping company.

... In a new conference yesterday, Ohio Sen. Sherrod Brown called on McCain and Davis to use the same connections they had in 2003 to try and stop DH: from abandoning the airport.

"I'm personally calling on John McCain to send Rick Davis to Germany to use his considerable clout with DHL,... to help save these 8,200 jobs in southwest Ohio," Brown said.

Davis was a lobbyist who helped [Deutsche Post World Net] overcome objections in Congress in 2003, when the company was acquiring Airborne Express and its Wilmington airport, as The Plain Dealer reported.

And McCain, then the chairman of the Senate Commerce Committee, fought back proposed legislative language in a defense spending bill that would have made the deal less attractive -- language favored by lawmakers and DHL competitors that wanted to keep the foreign firm out of the air express business in this country.

Davis and McCain were successful in 2003 -- and so was Wilmington for several years, with a humming freight airport and a net gain of an estimated 1,000 jobs. But now DHL wants to use rival United Parcel Service for its air freight, saying the move would help stem more than $1 billion in projected losses this year. DHL would stay in the delivery business, even though it would contract with UPS for airlift.

Wilmington officials are worried about the potential loss of up to 8,000 jobs if DHL moves work away from the Wilmington Air Park by hiring United Parcel Service to replace ABX Air and ASTAR Air Cargo in transporting DHL packages.

... The McCain campaign told The Plain Dealer that no one in 2003 could anticipate today's threatened job cuts. The campaign noted that Davis has not lobbied for Deutsche Post since 2005.

Before the merger, some members of Congress, as well as UPS and Federal Express, cited concerns about a subsidiary of a foreign company controlling a segment of air commerce in the United States. Sen. Ted Stevens, Republican of Alaska, tried to insert language in a military spending bill to ban a foreign-owned carrier from flying military equipment or troops. That would have made the Airborne Express purchase less attractive to DHL.

McCain, of Arizona, and fellow Republican Sen. Trent Lott of Mississippi objected, saying it would be unfair to keep the Pentagon from using an air carrier it might someday need. McCain, then the chairman of the Commerce Committee, also objected to using a spending bill to set military policy.

"Moreover, Sen. McCain has a long-held belief that defense contracts should reflect providing our service members the best equipment and support while providing the best return to American taxpayers, irrespective of narrow and protectionist concerns," his campaign said .
He prevailed. After the merger, Ohio and local governments provided more than $400 million in incentives for road and facility upgrades, and DHL in 2005 moved its smaller air freight operation from northern Kentucky to Wilmington.

The ad features video of McCain's exchange in early July with a woman at a town hall in Portsmouth, Ohio and reporting from The Plain Dealer and cleveland.com.

The Democratic Party noted that on the eve of McCain's visit today to DHL-Airborne Express in Wilmington, Stephen Koff, The Plain Dealer's Washington Bureau chief, reported that McCain's campaign manager and longtime friend Rick Davis lobbied on behalf of DHL to overcome Congressional opposition to allowing a foreign company to take over Airborne, and that McCain himself intervened to ensure that the deal went through.

The story on Tuesday said that filings in the Senate show Davis' lobbying firm, Davis Manafort, was hired to help both companies deal with Congress, where objections over DHL's foreign ownership arose. Davis and a partner earned their firm $185,000 for the DHL-Airborne Express work that year, records show.

They earned $405,000 more from Deutsche Post for work on other issues in 2004 and 2005, after the deal passed Congress.

Labels: 2008 election, jobs, John McCain, presidential candidates, Rick Davis, u.s. economy, Washington lobbyists

One of John McCain's most celebrated achievements in recent years was his crusade to block a Pentagon contract with Boeing for a new fleet of midair refueling tankers. Incensed over what he denounced as a taxpayer "rip-off," McCain launched a Senate probe that uncovered cozy relations between top Air Force officials and Boeing execs. A top Air Force officer and Boeing's CFO ended up in prison. Most significantly, the Air Force was forced to cancel the contract—saving taxpayers more than $6 billion, McCain asserted.

But last week, McCain's subsequent effort to redo the tanker deal was dealt a setback. Government auditors ruled that the Air Force made "significant errors" when it rebid the contract and awarded the $35 billion project to Boeing's chief rival, partners European Aeronautic Defense and Space Co. (or EADS) and Northrop Grumman. It's likely the Air Force will have to redo the bid yet again, which analysts say will delay the replacement of the fleet's 1950s-era refueling tankers. The auditors' ruling has also cast light on an overlooked aspect of McCain's crusade: five of his campaign's top advisers and fund-raisers—including Tom Loeffler, who resigned last month as his finance co-chairman, and Susan Nelson, his finance director—were registered lobbyists for EADS. ...

Critics, including some at the Pentagon, cite in particular two tough letters McCain wrote to Deputy Secretary of Defense Gordon England in 2006 and another to Robert Gates, just prior to his confirmation as Defense secretary. In the first letter, dated Sept. 8, 2006, McCain wrote of hearing from "third parties" that the Air Force was about to redo the tanker competition by factoring in European government subsidies to EADS—a condition that could have seriously hurt the EADS bid. McCain urged that the Pentagon drop the subsidy factor and posed a series of technical questions about the Air Force's process. "He was trying to jam us and bully us to make sure there was competition by giving EADS an advantage," said one senior Pentagon official, who asked for anonymity when discussing a politically sensitive matter. The assumption within the Pentagon, the official added, was that McCain's letters were drafted by EADS lobbyists. "There was no one else that would have had that level of detail," the official said. (A Loeffler associate noted that he and Nelson were retained by EADS after the letters were drafted.)

Labels: 2008 election, Boeing, EADS, free trade, jobs, John McCain, NAFTA, outsourcing, presidential candidates

Labels: 2008 election, Barack Obama, Hillary Clinton, jobs, polls, presidential candidates, the Bush recession, u.s. economy