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also Lockheed Martin's vice president for

It would seem that surplus giveaways

strategic planning). Boeing used its meeting

would undercut U.S. arms exporters by pro-

with Onyszkiewicz as an opportunity to offer

viding free or deeply discounted equipment

a major arms package, which included the

to countries that might otherwise buy new

lease and sale of F-18 fighter aircraft, Polish

weapons from U.S. firms. The actual effects

participation in the L-159 trainer aircraft

are more complex. In some cases, surplus

project (which Boeing is carrying out with its

sales or leases can serve as "loss leaders" that

Czech partner, Aero Vochody), licensed man-

are used to introduce cash-strapped foreign

ufacturing of Boeing's Hellfire II anti-armor

customers to U.S. equipment and set them

missile, and a new avionics package for

up for possible sales of new weaponry in

Poland's Soviet-built Mi-24 helicopters.

the future. For example, the hotly contested

Boeing spokesman Jim Schleuter described

race to see which U.S. fighter manufac-

his company's rationale for this impressive

turer--Boeing or Lockheed Martin--can get

package as follows: "We are committed to

Poland to lease its aircraft (either the

being a strategic partner for Poland right

Lockheed Martin F-16 or the Boeing F-18) is

across the military aerospace spectrum. We

a first step toward selling Warsaw advanced

support their military modernization pro-

combat aircraft.

The Clinton

cess."24 Boeing is obviously willing to invest

After making exaggerated claims a few

administration is

years ago about the possibility of buying as

time and resources now to lock up a chunk of

many as 200 modern Western combat air-

the Polish arms market in the future. If

following its pre-

craft, the Polish government has recently

Boeing can use free surplus fighters from the

decessor not only

taken a much more deliberate attitude

U.S. government as part of the bait, so much

in pressing

toward modernizing its air force. Poland may

the better.

begin by entering into a $100 million leasing

Targeted Tax Breaks for Weapons Contractors

embassy person-

arrangement for about a dozen surplus U.S.

and Their Foreign Clients. Although U.S.

nel into service

F-16 or F-18 aircraft. The lease could be fol-

weapons manufacturers often claim that

on behalf of U.S.

lowed by purchase of a few dozen new com-

their appeals for new government subsidies

bat aircraft in 5 or 10 years' time. Similar leas-

are required to "level the playing field"

weapons export-

ing deals are being offered to Hungary and

between defense exports and other products,

ers but also in

the Czech Republic, but Poland is closer to

the reality is that arms producers receive a

making a decision.

steady stream of government support for

promoting

The fighter lease for Poland, which is

research, development, and production far

weaponry at air

worth next to nothing in its own right, has

exceeding what the government provides for

shows.

sparked an aggressive competition between

any other industry or product. If the govern-

Boeing and Lockheed Martin to see which

ment wanted to level the playing field

company can "get its foot in the door" of the

between the weapons industry and other sec-

Polish arms market. Each company hopes

tors, it would have to reduce weapons subsi-

that once Poland becomes familiar with the

dies, not increase them.

firm's equipment, the firm will be in a

Despite the weapons sector's obvious advan-

stronger position to make a sale of large

tages over industries that have to finance most

numbers of new aircraft to Poland early in

of their own research and development and

the next century. When Polish defense minis-

tailor their products to the needs of a diverse

ter Janus Onyszkiewicz visited Washington

customer base, the weapons industry has fre-

in January 1999, he was courted by U.S. arms

quently succeeded in winning new favors from

makers. His official schedule included meet-

the government on the specious grounds that

ings at Boeing, Lockheed Martin, Pratt and

certain government practices "discriminate"

Whitney (which makes engines for fighter

against arms manufacturers.

aircraft), and the U.S. Committee to Expand

"Recoupment fees" are charges to buyers

NATO (whose president, Bruce L. Jackson, is

of U.S. arms to help reimburse the U.S.

9