Time for Congress to Act

By Ed Timperlake

Working for two very accomplished Congressman, Secretary Ed Derwinski, who served 10 terms as a Republican Representative from Chicago, and then Chairman Jerry Solomon of House Committee on Rules, I saw both men have a strong appreciation for American workers.

First and foremost they respected the dignity of each individual and the need for workers to be treated fairly by management. Both men were very patriotic and would go the extra mile to keep the American Industrial Base vibrant and capable of competing in the world market place.

In a bit of irony, the T-6 seen recently at the Oshkosh air show.

It was evident that the unfair exploitation of the hard working citizens of China by a totalitarian thuggish and authoritarian government was creating a non-level playing field for the American worker. It may surprise a few but Chairman Solomon, a very strong conservative was respectful and extremely helpful to American Labor Unions. It was a solid partnership and under the Chairman’s guidance the staff of the Rules Committee reached out to the AFL/CIO when PRC issues were in play.

Now there is breaking news on a Labor Union court action:

WICHITA, Kan. – A machinists union urged a bankruptcy judge Wednesday to consider the “complete irony and hypocrisy” of Hawker Beechcraft’s request to pay eight top executives more than $5.3 million in bonuses while other jobs are cut and the company seeks to eliminate pension plans…..

Hawker Beechcraft is seeking “to unfairly discriminate in favor of certain high level employees at the expense of their rank-and-file employees,” according to the filing. “Providing certain employees with excessive, easy to reach bonuses, while simultaneously seeking (to) eliminate jobs and reduce pension obligations to others, is certainly not fair and reasonable.” …

Hawker Beechcraft Corp., based in Wichita, is owned by Onex Partners and GS Capital Partners, a Goldman Sachs private equity fund. The company filed for bankruptcy protection in May. The court has approved exclusive talks with a Chinese firm that has offered nearly $1.8 billion to purchase the company’s business jet and general aviation operations.

And there are additional challenges for HB’s workers.  HB is being sold to a Chinese firm.  And what are the implications for their defense work?

Hawker Beechcraft has gone out of the way to minimize and down play Chinese acquisition of their Defense sector, but Rexana Hegeman of AP got  it right on July 17 2012:

The proposed sale to Superior purportedly does not include Hawker Beechcraft Defense Co., but some of the details of the proposed exclusivity agreement involving the defense operations also drew fire from the union.

For example, if the defense operations are sold, up to $400 million of the $1.79 billion purchase price would be refundable to Superior, which the union suggests means the Chinese-controlled entity would be involved in business related to sensitive national security issues.

Overlooked so far is the question of how does one buy a company and not look at all its operations, including defense?

Are the Chinese getting an inside look at every militarized aspect of Hawker Beech’s military C-12 aircraft-from Project Liberty the MC-12, to the UC-12 Guard Rail, and also any current or planned upgrades to AT-6?

Who is Superior Aviation?  Always a good question to ask when American technology is being bought from abroad, notably from China.  Congress clearly needs to pursue this matter.

The Wall Street Journal asked this question and in part concluded that

Superior is 60% owned by Chairman Cheng Shenzong, a Chinese businessman whose other holdings include Qingdao Haili Helicopter Co. and Qingdao Brantly Investment Group.

Haili Helicopter’s Chinese website shows that the company was founded in August 2007 in the Eastern China coastal city of Qingdao. The company’s total investment was $23.35 million, with a registered capital base of $10.2 million. It was designed to have an annual production capacity of 80 Brantly B-2B helicopters, the website shows.

The aircraft has two to five seats each and is used by firefighters, riot police and civilians, according to a transcript of a television newscast posted on Haili’s website.

Haili – meaning “seaworthy” in Chinese, loosely – obtains design and production authorization, as well as certification by the Federal Aviation Administration of the U.S., through a joint venture, the website says. The site features pictures of helicopters hovering over a cityscape with a bay view.

Qingdao Brantly’s website, meanwhile, isn’t functional.

Emily Behlmann of the Wichita Business Journal wrote that “Superior Aviation is something of a mystery and that could be telling.”

Obviously this mystery needs to be explored.  Is this a “Chinese Firm” which far too often is a PRC/PLA deep pocket owner and are fully capable of collecting significant intelligence, proven combat technology paid for by American combat blood in Afghanistan, during this murky gray area between the announcement and when someone pays for the defense sector that they “do not own?”

The Congress needs to focus attention on this issue.  The stakes are significant for America and its workers.

Additionally, tied in very closely with the Bankruptcy is the ongoing quest by Hawker Beechcraft to win a contract to provide Light Attack aircraft to the Afghan Army Air Force.

It is a nasty fight and HBC management did not care that in their greedy quest to win at all costs US combat troops along with the Afghan Army infantry would be delayed critical life saving and battle winning air power assets.

Nathan Hodge of The Wall Street Journal had the most comprehensive analysis of that key issue in play.

As the American bankruptcy tragedy played out the unions were warned and may have only themselves to blame.

It is now important that Congress to now investigate this entire matter, National Security vulnerabilities and considerations combined with HBC/Onyx/Goldman Sachs expedient, callous and significant disregard for the Union workers beg for such action.





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