Entries in General Electric (1)


Pentagon Terminates Controversial Jet Engine

Digital Vision/Thinkstock(WASHINGTON) -- The Pentagon announced Monday it has stopped payment on a controversial fighterjet engine program that military brass long decried as a boondoggle but had thrived for years anyway with the backing of powerful leaders in Congress and a push from a brigade of well-connected lobbyists.

"The Department of Defense today notified the General Electric/Rolls Royce Fighter Engine Team and the Congress that the F136 Joint Strike Fighter engine contract has been terminated," a Defense Department release said Monday. "The stop work order ended the expenditure of $1 million per day on an extra engine that the [Pentagon] has assessed as unneeded and wasteful."

The statement was intended to bring finality to a decision that has for years been grist for an intensive public relations and lobbying war inside Washington. President Obama identified the engine, being developed jointly by General Electric and Rolls Royce, as a symbol of wasteful spending. He and others decried it as an unnecessary duplication of work already contracted to Pratt & Whitney, which had been tapped to design the propulsion system for the next generation of American fighter jets, known as the Joint Strike Fighter.

"The Bush administration opposed this engine. The Obama administration opposes it. We have recommended for several years now against funding this engine, considering it a waste of money," Defense Secretary Robert Gates told reporters last May. "To argue that we should add another $3 billion in what we regard as waste...frankly, I don't track the logic."

The Pentagon and the president repeatedly called for the program to be cut from the budget, but Congress always responded by setting aside more money for the project. Supporters of the alternate engine said taxpayers would benefit by having two defense contractors competing to develop propulsion systems for the fighter jet. Over the long haul, they said, the competition would force the price down and produce overall savings.

Critics disputed that argument, saying the development of two engines represented an enormous extra expense with no guarantee that it would yield savings. They also accused GE and Rolls Royce of exploiting their presence in key congressional districts around the country -- factories doing work on the engine are located within a few miles of districts held by House Speaker John Boehner, R.-Ohio, and Majority Leader Eric Cantor, R.-Virginia.

The competing arguments helped fuel one of the most costly lobbying and PR campaigns in Washington in recent memory. The clash came to a head earlier this year as congressional leaders and the president negotiated the final details of the 2011 budget under a threat of a government shutdown. The engine project wound up on the cutting room floor.

GE, which according to the Center for Responsive Politics has spent more on lobbying over the past decade than any other American company, vowed Monday to continue to work on the project in the hopes it could be revived as Congress takes up the 2012 budget.

"While we are deeply disappointed by the DoD's 'Notice of Termination,' GE and Rolls-Royce remain committed to the [engine] and the significant benefits it brings to the American taxpayer and our fighting men and women," GE spokesman Rick Kennedy said in an email to ABC News.

"GE and Rolls-Royce will work closely with our Congressional supporters during the 2012 budget process in pursuit of incorporating the engine into the program, and preserving competition," Kennedy said. "We continue to be encouraged by the bi-partisan support for the engine on the merits of its performance and value. There is a significant willingness in Congress to revisit the [engine] funding debate as the consequences of terminating the engine are being fully understood."

Copyright 2011 ABC News Radio

ABC News Radio