Did the U.S. Army Arrange a 'Sweetheart' Deal to Sell Russian Helicopters to Iraq?

[sabra]

Source: WIRED News

The Defense Department quietly gave a U.S. company a contract to provide 22 new Russian-made Mi-17 troop transport helicopters to the Iraqi military in a deal worth an eyebrow-raising $325 million, DANGER ROOM has learned.

Iraq's effort to re-equip its military has been marred with corruption, including a notorious plan to buy used Mi-17s from Poland in a deal that involved accusations of shoddy equipment and was eventually scrapped. This new Mi-17 contract, which involves Iraqi money routed through the Pentagon's foreign military sales process, was designed to avoid problems that occurred in the previous sale. But in an unusual move, the U.S. Army sole sourced the contract to ARINC, a Carlyle Group-owned company.

The deal, which was consummated earlier this year, may represent the highest price ever paid for the Russian-produced helicopters, which are sold by a number of brokers, as well as directly from the manufacturers in Russia.

For ARINC, the contract offers the potential to boost the company's estimated annual $900 million revenues by one-third. That's not bad, considering the company is essentially just serving as a broker for equipment manufactured in Russia.

Read more: http://blog.wired.com/defense/2008/07/earlier-this-ye.html

[Bruce McAuley]

1. How do you spell "kickback" again?

Poppy Bush makes how much on this deal? Will it buy him a new golf cart to drive around Kennebunkport in?
How quiet will this remain now?

Bruce

[AlphaCentauri]

2. those are the WMD we didn't find

[Plucketeer]

3. One more insult

to AMERICAN AVIATION INDUSTRY! :grr: Airbus-built USAF tankers, Swedish helicopters for the president, WTF??? :wtf:

[bdab1973]

4. This was pushed by the Iraqi MoD

...not the United States. We tried to sell them more UH-1 Huey helicopters, but the Iraqis wanted the Mi-17s. Just like we offered them more C-130s but they seem to want to lean towards Antonovs. The Iraqi Air Force at the squadron level is being trained to operate western aircraft, but the staff at the MoD was brought up with Russian equipment. This wasn't something the US pushed...basically the Iraqis said "we want the Mi-17s, make it happen" and it did.

[Plucketeer]

11. Be that as it may

We went in there and set these folks up from mere rubble, helped put their oil business back on it's feet (remember - this was was supposed to be financed with Iraq oil money in the end!) and some little brokerage firm gets a fat paycheck while US aircraft workers get forclosed homes. Yeah, more of the Bushian way of economics. :puke:

[bdab1973]

14. It's not up to us

We're here to advise not tell them what to do. Right now, the US is in the position of trying to remove itself from Iraq. If the Iraqis want Russian made helicopters and want to sign a deal that costs them alot of money, that's their decision. They operated Russian aircraft for years prior to 2003, so it's only natural they want to gravitate back to that. It wouldn't really be advising if we said "no, you can't buy that...you must buy this instead"...we'll make suggestions, but in the end, it's their Air Force, and their decision. Tell you the truth, no one in our organization really wants the Rusky aircraft on the ramp because none of us are familiar with it.

[awoke_in_2003]

12. "Airbus-built USAF tankers"

Boeing kinda did that to themselves. Their arrogance was evident by the fact that they were going to lease aircraft (instead of sell) to the aircraft for a period of time at a cost of 5 times buying them outright. They were warned, they didn't listen.

[bdab1973]

15. The AF was in a tight spot

Regardless of the decision, it would have been criticized. If it had selected Boeing, the critics would have pointed out that the Boeing design was smaller and hauled less gas to offload to receivers. They would have likely said that Boeing had the AF in it's pocket all along.

The Air Force did what it felt it had to do...it chose the aircraft that had the most capability. Unfortunately, the protest by Boeing was upheld since Boeing claims the USAF didn't state it wanted a more capable aircraft...basically the 767-based design met the minimum objectives. That's fine, but the KC-45 (Airbus) exceeded many of the goals and cost about the same. There are arguments you can make for either aircraft...ie, smaller would be more flexible, bigger would be more capable and on and on. But in the end, the USAF had to make a choice and unfortunately it was a darned if you do, darned if you don't result.

[awoke_in_2003]

16. My boss was a BUFF

(Big Ugly Fat Fucker or B52 pilot) and he agrees: Boeing got to big for their britches. Thought they could impose what they wanted onto the USAF. A smack down was coming, and they got it. Boeing will react and change their way of thinking.

[Plucketeer]

17. Wouldn't it be cheaper

to just buy all our tankers and cargo planes from Antanov? We could even stipulate a certain percentage of US-made parts be used.

[bdab1973]

18. No...

Because Antonovs are POS's.

[Plucketeer]

19. Heh

Like Airbus hasn't had problems.

[Enrique]

5. McCain is saying it would be "dangerous" to end the war

I didn't realize the true danger was to these contractors.

[bdab1973]

6. Any aircraft you buy

Will be bought through contractors or some buying agent. Governments don't sell aircraft. Even the C-130s we donated to the Iraqis were sent to a contractor to prepare them for use over in Iraq. One thing I've noticed about the Iraqi government is it tends to be very compulsive when it settles on an aircraft. They will find all sorts of ways to try and get a cheaper deal and wind up screwing themselves. I've seen US advisors tell the Iraqi government that a certain contract isn't going to help them, but they sign it anyways. I've got lots of examples of that. This is one of the examples...lower level Iraqis plus the US advisors basically had to sigh when they found out the Mi-17s were coming aboard, and how the IqAF rushed to get them.

[Enrique]

7. no, I don't think that's the way it is

I think you've posted a myth.

I think some greedy corrupt Americans are making a killing over this war, and some greedy corrupt Iraqis are making a smaller killing, and a lot of innocent Americans are getting ripped off and a lot of innocent Iraqis are getting killed and also getting ripped off.

And I think the level of sophistication of Americans and Iraqis is about the same.

[bdab1973]

8. Myth?

I've had personal experience with this issue. Where's your sources and information coming from? Just DU and other "news" outlets?

[Enrique]

10. even more reason for you to relate the myth

regarding the sources for my pretty obvious statement about corruption, see the OP. Credible sources like Wired and many many others tell tons of stories about how our tax money is making some people really rich off this war. Congressional hearings, corruption convictions as well.

Stacks up pretty good against an anonymous internet poster claiming expertise and painting a picture of benevolent
Americans and unsophisticated Iraqis.

[bdab1973]

13. That's fine...typical

If I had been some anonymous anyone who got on here and told stories that agreed with your already-arrived at opinion, then you'd probably be giving me a virtual high-five. But since I take issues with the accuracy of the above story, I'm to be doubted. That's fine. There are verified stories of misuse and greed out there. And I think I covered that in another post, that my issue wasn't that it isn't happening, but that the contract with the Mi-17 was more the Iraqis than us.

If you wish, I'd be more than happy to somehow send you a photo or something else...I just took one up at Erbil yesterday. Again, one of my biggest peeves with this site are the number of people who will jump on any bandwagon and believe any story or conspiracy so long as it bashes the other side. And then you wonder how in the world could they sit there and have the nerve of calling us "nuts"? There's a rational reason for everything, and it's not always the sensational "hey, it's a crime!" thing going on.

Anyways, as I'd say here...maarhaba, t'asharafna, t'isbah al-Kheir....ma'a as salamaa. I can speak basic Arabic and listen...but I can't write it since it goes the other direction. You'll figure out, if you get the chance to work around Iraqis, that they often do what they want, even if it doesn't make sense to you. You just nod your head and say "na'am sayadee" and hope it works out.

By the way, I never said the Iraqis are unsophisticated. They are just different. They approach business with people and personal relationships in mind, not with goals-based results like our western views do. They will make a deal if it's in the best interest of the relationship, not necessarily if it's in the best interest of a particular goal. As we say here..."it's not right...it's not wrong...it's just different".

For your education, look up the 370th AEAG and CAFTT on google and do some research before you think all Americans over here are just gun-toting thugs trying to rip them off.

[bdab1973]

9. By the way...

You are partially right about greedy corrupt Americans and Iraqis...they certainly exist and I am not trying to refute that. But when it comes to this particular deal...well...the Iraqi "political process" tends to get in it's own way.