For Whatever It's (Fort) Worth

Strategy, security and friendship certainly went into the United States decision to reverse a 15-year policy and sell F-16s to Pakistan but base economics was also at play. The economy of Texas, to be precise, the home state of President George Bush. Lockheed Martin, manufacturer of the F-16s, was planning to downsize and ultimately shut down a plant in Fort Worth, Texas, by 2008 in the absence of new orders. Nearly 5,000 American jobs were on the line.

Bush's decision to grant General Pervez Musharraf his wish ensures the survival of a weapons plant and continues the family tradition. His father George Bush Sr had saved Lockheed Martin's F-16 production line in 1992 by approving a sale of 150 planes to Taiwan. If India also decides to buy the F-16s, it will surely be Diwali in the Fort Worth plant. The Indian air force reportedly favours the French Mirage 2000 and the tender is scheduled to open in April with evaluation starting by the end of the year. A decision is expected in about two years. Even if India orders by 2006, the first planes won't be delivered before 2010 while Pakistan will likely begin receiving its F-16s from Lockheed by 2008.

Lockheed spokesman Joe Stout, while distancing the company from its marketing executive Mike Kelly's breathless promises to build customised planes for India, nevertheless acknowledged that the corporation was "looking at the market to extend" its production line beyond 2008 when the current contracts for 200 planes from different countries would be delivered. "We would like to get an order this October, so we can extend beyond 2008," he said. There is a three-year lead time from the time an order is placed to when the planes are delivered.

Job cuts at Lockheed, the largest US defence contractor, have already been under way since last year when the Fort Worth plant had about 5,800 workers. This January, the work force was reduced to 5,000 with another 1,000 job cuts planned by next year, according to company spokesmen. Lockheed's chief executive Robert J. Stevens told employees last year that the future of the company depended on whether it could be economically successful and keep up with changing defence priorities.

Bush gave Lockheed a much-needed shot in the arm by approving the sale of F-16s to Pakistan over India's objections. His ties to the company go back to the days when he was governor of Texas and tried to give Lockheed a contract to run the state's welfare system but backed off in the face of public protests. Vice President Dick Cheney's wife, Lynn, has served on Lockheed's board in the past and received $120,000 annually. The Bush-Cheney combination is said to be the arms industry's "dream team". It is no surprise that the Bush administration found it useful to reward both Pakistan and Lockheed Martin in one go, while justifying the sale on security grounds. No public demands were made of Musharraf, no conditions articulated.

Peter Lavoy, director of the Centre for Contemporary Conflict at the Naval Postgraduate School in California, said the sale to Pakistan was "good for Lockheed and good for the United States". Continued production ensures continued supply of spare parts for F-16s for the US air force. "We still rely on the F-16s as the main fighter plane. The alternative was shutting down the plant," he said.

But there are experts who insist that the Bush package for South Asia was driven primarily by foreign policy realities, not dollars and cents. "The US arms industry is thriving—US arms exports are higher than most of the world combined, so it's hard to claim that the aircraft industry is on life support," said Timothy Hoyt, professor of strategy at the US Naval War College. "However, as in India, business lobbies do have some impact on policy because of the democratic process.The sale will create or maintain jobs in the defence industry but job creation and corporate profits are not the driving force behind the US decision. " Well.