On Friday it was reported that one U.S. Senator is threatening to block all White House nominees that need Senate confirmation to serve in order to extract concessions from the Pentagon that would allow a foreign defense contractor to win a multi-billion dollar contract at the expense of an American company.

Sen. Richard Shelby (R-AL) has put a blanket hold on all Obama administration nominees in order to goad the Pentagon into tweaking the rules for bidding on a $35 billion Air Force contract for a fleet of new aerial refueling tankers.

Shelby wants the rules changed to favor French aircraft maker Airbus, which plans to build a factory in Alabama if it wins the contract. Unfortunately, the rule changes could put American aircraft maker Boeing at a severe disadvantage.

“Nearly 10 years after the US Air Force announced plans to replace the aging tanker fleet, we still do not have a transparent and fair acquisition process to move forward,” Shelby spokesman Jonathan Graffeo said. “The Department of Defense must recognize that the draft Request for Proposal needs to be significantly and substantively changed.”

Shelby’s hold on Obama administration nominees is yet another bizarre turn in what has been a nearly decade-long competition plagued by scandals, investigations, trade disputes and accusations of collusion between the Air Force and Boeing.

In February of 2008, as EconomyInCrisis reported, the Air Force awarded the contract to French aircraft manufacturer Airbus and its partner Northrop Grumman over Boeing.

The contract, however, was stripped that September after the Government Accountability Office deemed the original bidding process to have contained “significant errors.”

As we reported back then, 14,000 American jobs are at stake in the deal in the near-term. Furthermore, the winner of the contract will be provided a built in advantage in future competitions, which is significant because the Air Force will likely replace its entire fleet of tankers again in the near future at an ultimate cost of $100 billion.

Moreover, Boeing desperately wants to win the contract to keep its edge in the manufacturing of commercial aircrafts. Currently, Boeing enjoys a virtual monopoly in that department, with no domestic competition. If Airbus were to win the contract, the company has stated its intentions to build a manufacturing facility in Mobile, Ala. and enter the U.S. market building commercial aircrafts.

The Economic Policy Institute’s Robert Scott also found that Airbus’ estimates for employment impact in America are inflated by at least 45 percent and possibly as much as 179 percent. Recently Airbus’ parent company, EADS, failed to create even half the U.S. jobs it claimed it would deliver after being awarded a contract for light duty helicopters.

“I guess if you needed one example of what’s wrong with this town, it might be that one senator can hold up 70 qualified individuals to make government work better because he didn’t get his earmarks,” White House Spokesman Robert Gibbs said, according to The Huffington Post. “If that’s not the poster child for how this town needs to change the way it works, I fear there won’t be a greater example of silliness throughout the entire year of 2010.”

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