Two BAE officials just got detained at a US airport as part of the US Department of Justice's investigation into claims that BAE bribed Saudi princes to secure the largest British export agreement ever.
The question that pops into my mind is: Why the hell is the US government investigating this?
I mean, what business is it of theirs? It's a British company who's (allegedly) bribed Saudi princes. It's also a British company which sells vast amounts of equipment to the US military. It's also a British company that wants more access to the US defence market... It's also a British company that is under low-level but constant rumours of a possible merger with US defence giants. The US government and contractors, it turns out, have some big links with BAE. The question still stands though, just in a different guise: Why would the US government want to investigate this?
I honestly don't know but I see a few possible reasons:
1) The British government knew that it couldn't continue the investigation because the Saudis would go apeshit and cut off all defence contracts with BAE, seriously hurting a company which employs 111,578 in one of Britain's hitherto most successful manufacturing sectors. There's little risk of them doing the same with the US because the relationship of power is inverted there: The US has substantial power over the Saudis, whereas the Saudis have some leverage over us. So the British government called off the investigation and got the US to start theirs. I don't think this is that reasonable though: Why would the UK government want to risk discrediting a major British company?
2) The US Justice Department is going on a crusade to make itself look good and to gain their own, extra, leverage over the Saudis and the Brits. If this is true, expect the investigation to never really come to a conclusion but to fizzle out silently.
3) The US government wants to discredit BAE to protect their own defence contractors from competition, especially after BAE's takeover of Lockheed Martin's Aerospace Electronic Systems division. Potentially they also want to force BAE to lose the contract, hurting them massively and make the option of a takeover/merger with Boeing look far, far more attractive for both parties. And given the option between a US takeover or a collapse of BAE, I am sure that the British government will choose not to exercise its golden share rights.
I'm not sure but I'll say this: I am glad that the SFO did call off the investigation. I think it's morally wrong and touching on the criminal but it's protected a lot of jobs and families and at the end of the day, I don't think the British government should be investigating an arms deal that has done so much domestically. Especially when the only victims will be British workers and executives. It's not a secret in the arms industry that deals are often only signed once substantial "incentives" are offered to those doing the signing in the recipient country and I have no doubt that BAE was not the only firm offering these alleged bribes.
Simply put, calling off an investigation is a bargain to save thousands and thousands of jobs.
Subscribe to:
Post Comments (Atom)
1 comment:
It is an odd move. Firstly though, I'd say that the economic value of arms sales in this country is overblown and while it is a large employer and revenue generator, it is not indispensable. Rather than protecting an economic asset, the need for good diplomatic relations with the Saudis is far more important and excuses what to me is (in isolation) a pretty serious crime.
I don't, though, think that the US is acting on our behalf in this, nor acting a a proxy for US arms companies. More likely that this is part of a broader effort to maintain the increased oil production that the US has now attained (though not without PR embarrassment), and also potentially to help Bush and by extension McCain deny that they have been giving excessive quid pro quo in exchange for co-operation on security matters like terrorist training and funding.
Post a Comment