OSINFO - Open Sources Information

Ubiquity's goals are to:

Empower users to control the web browser with language-based instructions. (With search, users type what they want to find. With Ubiquity, they type what they want to do.)

Enable on-demand, user-generated mashups with existing open Web APIs. (In other words, allowing everyone (not just Web developers) to remix the Web so it fits their needs, no matter what page they are on, or what they are doing.)

Use Trust networks and social constructs to balance security with ease of extensibility.

Extend the browser functionality easily.

Ubiquity for Firefox from Aza Raskin on Vimeo.

From: MASHABLE

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** CRS BILL DIGEST **

* HR2616: Encryption for the National Interest Act * * Sponsor: Goss (R-Fla.) * * Official Title: A bill to clarify the policy of the United States with respect to the use and export of encryption products, and for other purposes. * TABLE OF CONTENTS:

Title I: Domestic Uses of Encryption

Title II: Government Procurement

Title III: Exports of Encryption

Title IV: Liability Limitations

Title V: International Agreements

Title VI: Miscellaneous Provisions

Encryption for the National Interest Act - Declares that it is U.S. policy to protect public computer networks through the use of strong encryption technology, promote the export of encryption products developed and manufactured in the United States, and preserve public safety and national security.

Title I: Domestic Uses of Encryption - Makes it lawful for any person within any State and for any United States person to use any encryption product, regardless of encryption algorithm selected, encryption bit length chosen, or implementation technique or medium used, except as otherwise provided by this Act or by law. Defines "United States person" to mean any U.S. citizen, any other person organized under the laws of any State, and any person organized under the laws of any foreign country who is owned or controlled by such individuals.

(Sec. 103) Amends the Federal criminal code to prohibit, and set penalties for, knowingly using encryption in furtherance of the commission of a criminal offense for which the person may be prosecuted in a U.S. district court. Prohibits the court from placing on probation any person convicted of such a violation and prohibits the term of imprisonment imposed from running concurrently with any other term imposed for the underlying criminal offense. Specifies that the use of encryption by itself shall not establish probable cause to believe that a crime is being or has been committed.

Makes it unlawful for any person to intentionally: (1) obtain or use decryption information without lawful authority for the purpose of decrypting data, including communications; (2) exceed lawful authority in decrypting data; (3) break the encryption code of another person without lawful authority for the purpose of violating the privacy or security of that person or depriving that person of any property rights; (4) impersonate another person for the purpose of obtaining decryption information of that person without lawful authority; (5) facilitate or assist in the encryption of data, knowing that such data are to be used in furtherance of a crime; or (6) disclose decryption information in violation of code provisions. Sets penalties for violations.

Requires a court of competent jurisdiction to issue an order ex parte granting an investigative or law enforcement officer (officer) timely access to the plaintext of encrypted data, or requiring any person in possession of decryption information to provide such information to a duly authorized officer: (1) upon the application by a Government attorney that is made under oath and that provides a factual basis establishing the relevance of the information sought to a law enforcement, foreign counterintelligence, or international terrorism investigation; and (2) if the court finds that the information being sought is relevant to an ongoing investigation and the officer is entitled to such information.

Directs that the order issued by the court: (1) be placed under seal, except that a copy may be made available to the officer authorized to obtain access to the information sought in the application; and (2) subject to notification procedures, be made available to the person responsible for providing the information to the officer.

Bars disclosure of an application made or order issued under this section, except as specifically permitted by this section or another court order.

Directs that there be created an electronic or similar type of record of each instance in which an officer, pursuant to an order under this section, gains access to the plaintext of otherwise encrypted information, or is provided decryption information, without the knowledge or consent of the owner of the data who is the user of the encryption product involved. Authorizes the court issuing the order to require that the record be maintained in a place and manner that is not within the officer's custody or control. Requires: (1) the record to be tendered to the court, upon notice from the court; and (2) the court to make the original and a certified copy of the record available to the Government attorney and to the attorney for, or directly to, the owner of the data who is the user of the encryption product, pursuant to specified notification procedures.

Specifies that nothing herein shall be construed to enlarge or modify the circumstances or procedures under which a Government entity is entitled to intercept or obtain oral, wire, or electronic communications or information.

Directs the court, within a reasonable time but not later than 90 days after the filing of an application for such an order which is granted, to cause to be served to specified parties an inventory which shall include notice of: (1) the entry of the order or application; (2) the date of the entry of the application and issuance of the order; and (3) the fact that the person's decryption information or plaintext data has been provided or accessed by an officer. Allows the court, upon the filing of a motion, to make available for inspection to that person or that person's counsel such portions of the plaintext, applications, and orders as the court determines to be in the interest of justice.

Sets forth provisions regarding: (1) postponement of inventory for good cause; (2) admission of encrypted information into evidence; (3) contempt; (4) motions to suppress; (5) appeal by the United States; (6) a civil action for violations; (7) a statute of limitations; (8) exclusive remedies; (9) technical assistance by a provider of encryption technology or network service; and (10) reporting requirements.

Authorizes an officer to whom plaintext or decryption information is provided to use such information only for purposes of conducting a lawful criminal investigation, foreign counterintelligence, or international terrorism investigation and for purposes of preparing for and prosecuting any criminal violation of law. Bars any such information provided to an officer from being disclosed, except by court order, to any other person for use in a civil proceeding that is unrelated to a criminal investigation and prosecution for which the information is so authorized. Allows such order to issue only upon a showing by the party seeking disclosure that there is no alternative means of obtaining the information being sought where the court also finds that the interests of justice would not be served by nondisclosure.

Prohibits an officer from using decryption information to determine the plaintext of any data unless it has obtained lawful authority to obtain such data under other lawful authorities.

Sets forth provisions regarding: (1) the return of decryption information; (2) other disclosure of such information; (3) identification of material that discloses such information; and (4) responsibility of the officer to reasonably assure that inadvertent disclosure does not occur.

Title II: Government Procurement - Authorizes the President to require an encryption product or service procured to provide the security service of data confidentiality for a computer system owned and operated by the Government to include recoverability features or functions that enable the timely decryption of encrypted data or timely access to plaintext by an authorized party without the knowledge or cooperation of the person using such products or services.

Requires the President to ensure that all encryption products purchased or used by the Government are supportive of and consistent with: (1) all statutory obligations to protect sources and methods of intelligence collection and activities; and (2) those needs required for military operations and the conduct of foreign policy.

(Sec. 202) Authorizes the President to direct that any communications network established for the purpose of conducting the business of the Government use encryption products that: (1) include features or functions that enable the timely decryption of encrypted data or timely access to plaintext by an authorized party without the knowledge or cooperation of the person using such products or services; and (2) are supportive of and consistent with all statutory obligations to protect sources and methods of intelligence collection and activities and those needs required for military operations and the conduct of foreign policy.

(Sec. 203) Authorizes the President to require as a condition of any Government contract that any encryption product used by a private vendor in carrying out the contract include features or functions that enable the timely decryption of encrypted data or timely access to plaintext by an authorized party without the knowledge or cooperation of the person using such products or services.

(Sec. 204) Permits an encryption product to be labeled to inform Government users that the product is authorized for sale to or for use by Government agencies or Government contractors in transactions and communications with the Government under this title.

(Sec. 205) Bars the Government from requiring the use of encryption standards for the private sector, except as otherwise authorized by section 204.

(Sec. 206) Makes this title inapplicable to encryption products and services used solely for access control, authentication, integrity, nonrepudiation, digital signatures, or other similar purposes.

Title III: Exports of Encryption - Directs the President to control the export of all dual-use encryption products. Authorizes the President to deny the export of any encryption product on the basis that its export is contrary to national security. Provides that any decision made by the President or his designee regarding the export of encryption products under this title shall not be subject to judicial review.

(Sec. 302) Makes encryption products with encryption strength of 64 bits or less eligible for export under a license exception if: (1) such encryption product is submitted for a one-time technical review, does not require licensing under otherwise applicable regulations, and is not intended for a country, end user, or end use that is by regulation ineligible to receive such product and is otherwise qualified for export; (2) the exporter, within 180 days after the export of the product, submits a certification identifying the intended end use and intended recipient of the product and provides the names and addresses of its distribution chain partners; and (3) the exporter, at the time of submission of the product for technical review, provides proof that its distribution chain partners have contractually agreed to abide by all U.S. laws and regulations concerning the export and reexport of encryption products designed or manufactured within the United States.

Requires the technical review to be completed within 45 days after submission of all required information. Directs the President to specify the information that must be submitted for the one-time technical review. Prohibits the exportation of an encryption product during the technical review of that product.

Provides for: (1) periodic review of the license exception eligibility level; and (2) an export license exception for an encryption product whether or not it contains a method of decrypting encrypted data.

(Sec. 303) Authorizes the President to permit the export of encryption products with an encryption strength exceeding the maximum level eligible for a license exception if the export is consistent with national security.

(Sec. 304) Directs the President to establish procedures for the expedited review of commodity classification requests, or export license applications, involving encryption products that are specifically approved by regulation for export.

(Sec. 305) Authorizes the President to grant an export license for encryption products with an encryption strength exceeding the maximum level eligible for a license exception which are designed or manufactured within the United States (with an exception) under the following conditions: (1) there shall not be any requirement, as a basis for an export license, that a product contains a method of gaining timely access to plaintext or decryption information; and (2) the export license applicant shall submit the product for technical review, a certification under oath identifying the intended use of the product and the expected end user or class of end users of the product, proof that its distribution chain partners have contractually agreed to abide by all U.S. laws and regulations concerning the export and reexport of encryption products designed or manufactured within the United States, and the names and addresses of its distribution chain partners.

Requires the technical review to be completed within 45 days after submission of all required information. Bars exportation of an encryption product during the technical review.

Requires all exporters of encryption products designed or manufactured within the United States to: (1) submit a report to the Secretary of Commerce (the Secretary) at any time the exporter has reason to believe any such exported product is being diverted to a use or a user not approved at the time of export; (2) report any pirating of their technology or intellectual property to the Secretary as soon as practicable after discovery; and (3) submit to the Secretary a report specifying the particular product sold, the name and address of the ultimate end user of the product (if known), or the name and address of the next purchaser in the distribution chain, and the intended use of the product sold.

Authorizes the Secretary, the Secretary of Defense, and the Secretary of State to exercise the authorities they have under other provisions of law to carry out this title.

Grants the President specified waiver authority.

(Sec. 306) Establishes an Encryption Industry and Information Security Board, which shall undertake an advisory role for the President. Sets forth provisions regarding the Board's purposes, membership, meetings, findings and recommendations, and termination. Specifies that the Board shall have no authority to review any export determination made under this title and that the consideration of foreign availability by the Board include computer software that is distributed over the Internet or advertised for sale, license, or transfer.

Title IV: Liability Limitations - Provides that, except for a person who provides plaintext or decryption information to another in violation of this Act, no civil or criminal liability shall attach to anyone for disclosing or providing: (1) the plaintext of encrypted data; (2) the decryption information of such data; or (3) technical assistance for access to the plaintext of, or decryption information for, such data.

(Sec. 402) Makes compliance with this Act a complete defense for any civil action for damages based upon activities covered by this Act, other than an action founded on contract.

(Sec. 403) Specifies that an objectively reasonable reliance on the legal authority provided by this Act authorizing access to the plaintext of otherwise encrypted data or to decryption information that will allow the timely decryption of data that is otherwise encrypted shall be an affirmative defense to any criminal or civil action that may be brought under the laws of the United States or any State.

Title V: International Agreements - Expresses the sense of Congress that: (1) the President shall conduct negotiations with foreign governments for purposes of establishing binding export control requirements on strong non-recoverable encryption products; and (2) such agreements should safeguard the privacy of U.S. citizens, prevent economic espionage, and enhance U.S. information security needs.

(Sec. 502) Authorizes the President to consider a government's refusal to negotiate such agreements when considering U.S. participation in any cooperation or assistance program with that country.

(Sec. 503) Sets forth reporting requirements.

Title VI: Miscellaneous Provisions - Directs the Attorney General to compile, and maintain in classified form, data on: (1) the instances in which encryption has interfered with, impeded, or obstructed the ability of the Department of Justice (DOJ) to enforce U.S. law; and (2) the instances where DOJ has been successful in overcoming any encryption encountered in an investigation. Requires that such information, including an unclassified summary, be submitted to Congress annually beginning October 1, 2000.

(Sec. 603) Authorizes appropriations for the Technical Support Center of the Federal Bureau of Investigation for FY 2000-2003.

===============================================================================

* Related Item: * ===============================================================================

* Subject Keywords: * Actions and defenses Administrative procedure American economic assistance Appellate procedure Armed forces Authorization Business Business intelligence Civil liberties Computer crimes Computer industry Computer networks Computer security measures Computer software Computers Computers and government Congress Congressional oversight Congressional reporting requirements Consumers Contempt of court Copyright infringement Counterintelligence Court records Criminal investigation Criminal justice Criminal justice information Cryptography Damages Defense policy Department of Justice Electronic commerce Encryption Evidence (Law) Executive Office of the President Executive departments Executive orders Export controls Exports Federal advisory bodies Fines (Penalties) Foreign aid Foreign policy Foreign trade promotion Fraud Government and business Government attorneys Government contractors Government employees Government information Government liability Government paperwork Government procurement Imports Imprisonment Information networks Information technology Intellectual property Intelligence activities Intelligence services International affairs International cooperation Internet Labeling Law Law enforcement Law enforcement officers Legal fees Liability (Law) Licenses Limitation of actions Military operations Military technology National security Official secrets Politics and government Presidents Pretrial procedure Probation Product development Prosecution Public contracts Recidivists Research and development Right of privacy Right of property Science policy Sentences (Criminal procedure) Standards Technology Technology transfer Telecommunication Terrorism Trade Trade agreements Trade negotiations Warrants (Law)

===============================================================================

Microsoft helped international law enforcement create the Child Exploitation Tracking System as part of a continuing collaboration to stop those who prey on children online.

TORONTO, April 7, 2005 -- The Child Exploitation Tracking System (CETS) saw early success while still in beta in November 2004. The tracking system identified a link between information arising from an FBI investigation in the United States and a separate investigation conducted by the U.S. Department of Homeland Security, known as Operation Falcon. As a result of this link, the Child Exploitation Section of the Toronto Police Service’s Sex Crimes Unit charged a man previously arrested on child-pornography charges with sexually assaulting a 4-year-old-girl, taking pornographic pictures of her and distributing them.

Microsoft Deputy General Counsel Nancy Anderson (L) and Royal Canadian Mounted Police (RCMP) Commissioner Guiliano Zaccardelli (R) at a news conference to announce the Child Exploitation Tracking System jointly developed by Microsoft, RCMP and the Toronto Police Service. Toronto, April 7, 2005.

Click image for high-res version.

CETS, a software solution built using open industry standards, assists law-enforcement officials in their work to stop the exploitation of children on the Internet by enabling effective collaboration and providing a set of advanced software tools and technologies for use by investigators. Officially launched today, CETS was developed jointly by Microsoft Canada, the Royal Canadian Mounted Police (RCMP) and the Toronto Police Service.

“Our vision is to support more effective child-exploitation policing by enabling collaboration and information sharing across police services,” says David Hemler, president of Microsoft Canada. “The tracking system will serve as a repository of information and will also be used as an investigative tool.”

Teaming of Industry and Law Enforcement

Inspector Jennifer Strachan, officer-in-charge with the RCMP’s National Child Exploitation Coordination Center, praises CETS for making linkages that have helped in the execution of warrants. She also applauds the tool’s use of SharePoint Portal Server to help track trends and post best practices. But most of all, she is optimistic about the partnering of law enforcement with industry.

“The old ways of policing won't meet the needs of today's cyber criminals,” Strachan says. “Industry created this environment, and Microsoft is setting a good example by realizing that with this innovation also comes accountability. Law enforcement will never be industry, and industry will never be law enforcement, but we need to keep the best interests of the people we serve in mind.”

As Strachan notes, it is difficult to look at the images of these children being exploited and not want to do something to save them. So she, like many others in law enforcement, is excited to see where CETS will take them.

“We see the excitement amongst police agencies when they realize the potential of this tool and the difference it will make in the fight against online predators,” Hemler says. “The responsibility lies with all of us to limit evil on the Internet and to protect our young people from being exploited. It is part of our duty as responsible leaders.”

CETS’s reach continues to grow as police agencies around the world show interest in using this tool.

“The international law-enforcement community is always looking for ways to stop child pornography and exploitation,” said Rich LaMagna, director of worldwide investigative and law-enforcement programs with Law and Corporate Affairs. “The international law-enforcement community has expressed strong interest in exploring this tool. CETS has got their attention as a way to have a great impact in this field.”

‘We Were Always Playing Catch-up’

The seeds for CETS were planted when Sergeant Paul Gillespie, a detective with the Toronto Police Service’s Child Exploitation Section, felt he was fighting a losing battle in his attempts to stop child exploitation online. While officers in his unit learned their way around the Internet, cyber-criminals were advancing in their ability to victimize children online, trade images and create pedophile communities, all in relative anonymity.

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From: R/W Web

Russia, which is home to almost 30 million of Europe's 350 million Internet users may begin to extend its strict media censorship laws to the Internet, according to a report in the AFP. State newspaper Rossiiskaya Gazeta reported today that Russia's prosecutor's office wants to toughen its "anti-extremism" laws on the web. Most newspapers and television are already under some form of governmental control, which makes the Internet one of the last places for free press in the country. New proposals would begin to erode the last bastion of press freedom in the country.

"The Internet is the freest area of the media in Russia," writes the AFP. Under current laws, Russian newspapers and television stations may be shut down by the government for printing or broadcasting content deemed extreme. A new proposal would extend that law to Internet web sites, which would need to be blocked "within a month" by ISPs if found to be publishing content what the government considers too extreme.

Freedom of speech advocates in Russia call the extremism laws too vague and sweeping, arguing that they are open for abuse by government officials. Last year, Russian news site www.gazeta.ru was warned for extremism after writing about political cartoons that satirized the prophet Mohammed.

Text of report by Swedish nation-wide liberal newspaper Dagens Nyheter website, on 10 April

[Report by Swedish news agency TT: "Proposed Bill on Security Service Surveillance"]

The Swedish Security Service should be authorized to use telephone tapping and camera surveillance in the future as well when investigating illegal paramilitary activities, according to a government proposal submitted to the Council on Legislation. The legal category of illegal paramilitary activities, was created in the 1940's. Today, it mainly concerns criminal groups that belong to the white-power movement and radical left-wing groups suspected of wanting to overthrow the democratic system. The government's investigators proposed last autumn that the category be eliminated, because there was concern that the use of telephone tapping, for example, would become far too widespread. But the government has decided to listen to the crime-fighting agency's wishes. The proposed bill would add three additional offences for which the security police could use telephone tapping and other so-called coercive means: crimes against civil liberties, such as threats to politicians and journalists, the financing of terrorism, and industrial espionage controlled by a foreign state. The bill does not affect the work of the normal police force, because the main rule is that telephone tapping and camera surveillance are only employed when the suspected offence carries a minimum sentence of two years in prison.

Source: Dagens Nyheter, website, Stockholm, in Swedish 10 Apr 08

From: http://globalguerrillas.typepad.com/

The history of the dominant technologies of 21st Century warfare won't spend much time on the complex and expensive systems developed by US defense contractors. Instead, the focus will be on the innovations that are derived from open tinkering networks of amateur inventors. The reasons for this include:

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The Federal Communications Commission (FCC) has adopted a new nationwide warning system that utilizes cell phone SMS to alert the public of emergencies. Called the Commercial Mobile Alert System (CMAS), only three types of emergencies will be relayed to the public: a disaster (such as a terrorist attack), immanent or on going threats (such as earthquakes), or child abductions (Amber Alerts). The new program is not mandatory, but T-Mobile, AT&T, Sprint, and Verizon have announced their willingness to participate in the new warning system. The FCC has been working with the carriers as part of the Commercial Service Alert Advisory Committee (CMSAAC) for coming up with the technical requirements for CMAS. The FCC is giving the mobile phone operators the freedom to design and implement their own infrastructure for deploying the system. The only restriction is that the participating carriers must comply with the requirements and complete their construction within 10 months.

The plan for CMAS is to organize a not-yet-named federal agency who generates the messages and sends them to the participated carriers. The emergency messages are then relayed to the public via SMS by the carriers. For the disabled, the wireless operators are required to send the alerts via vibration or audio cues. Furthermore, cell phone users are able to opt out of receiving the emergency messages, should they wish not to be bothered.

The emergency alert system originated in 2006 after Congress passed the Warning, Alert, and Response Network (WARN) Act, which provided $106 million in funding to create the national alert system.

Via: Gadgetell

Read more: PC Magazine

110th Congress - Second Session

The SPEAKER pro tempore. Under the Speaker's announced policy of January 18, 2007, the gentleman from Washington (Mr. Inslee) is recognized for 60 minutes as the designee of the majority leader.

Mr. INSLEE. Madam Speaker, Mr. Tiahrt of Kansas and I, and others may join us later, have come tonight to talk about an important issue with large national ramifications, and that is the decision by the United States Air Force to decline a contract for our next extremely important tanker and to give it to a consortium, a very significant portion of which will be manufactured in Europe through a consortium in part with EADS and the Airbus company in Europe.

I represent an area north of Seattle with thousands of Boeing workers; so obviously this is an important issue in my district. Certainly the hometown team is Boeing.

But our discussion tonight will be about why all America ought to be very concerned about this decision for several reasons. And it is an obvious situation where there is very significant employment in my district that any Congress person would be concerned about that, but what we want to [H1878] talk about tonight are the national ramifications and why we believe this is a very, very injurious decision that needs to be reversed one way or another.

For background in this regard, the very able and really spectacularly performing aircraft, the KC-135, that for decades have provided the very backbone of our United States Air Force capability, will soon be at some point entering their obsolescence. Herculean efforts have been put forward to keep those great airplanes in the air, but at some point we've got to have a new airplane, and we know that that is the case.

So we have been engaged in an effort to provide another replacement. A good United States product, Boeing, competed with subcontractors across the United States for a 767 airframe that we believed was perfect for the task, and by all information provided, the Air Force would provide the capability that was needed by the Air Force.

Unfortunately, the Air Force has decided to reject an American contractor on this extremely important contract. And obviously it's important for dollars. It's a $40 billion contract, with a "b." That is a significant contract. But of more importance to Americans are the job and employment prospects, and obviously that's important in the aircraft industry. If we see what has happened recently in the last decade, we know why it's important to think about this issue.

If I can refer to a chart showing the decline in teal or blue, this shows United States aerospace industry employment from 1979 to 2007. We have suffered a very, very significant decline, just about 50 percent of employment jobs in the United States compared to what we had in 1983, a peak year. Now, that has corresponded with the rise of the Airbus aircraft deliveries that have gone up, as indicated in these red bars, pretty much every year since about 1979. So we have had a significant loss of employment in the United States already in our aerospace industry. It has been in sync with the rise of Airbus sales. And we respect competition in America and should not decry or shrink from competition, and we would congratulate Airbus in a legitimate competition in any of these sales. But we point this out to show that we have already suffered a significant decline of thousands of jobs in the United States. So now we have a situation where that loss will be exacerbated by this decision should it stand.

Now, what is at stake here potentially could be 44,000 American jobs. Predictions are in that range of jobs that would have been involved in this contract. We know that we get different stories about where the Airbus employment will be. I want to point out one of the curious things, if I can. We get certain different viewpoints about where the jobs would be if, in fact, this contract is ultimately granted to Airbus. I note a newspaper article here in Les Echos, and I may mispronounce that, in Europe when Airbus talked about the employment on this contract. The article says that 76 percent of the employment associated with this tanker contract would be European and only 21 percent would be combined United States and Canadian content. That's in the article as publicized in France. In the United States, the rather large public relations effort that has gone on through Airbus, in fact, says it will be 50 percent in the United States. So it appears, at least in one instance, Airbus suggests that only 21 percent of the product in this tanker will be in the United States, and in America they suggest it will be about 50 percent. Some could chalk that up to hyperbole, salesmanship, but it means tens of thousands of jobs to Americans across this country, not just in the Seattle area where I reside but contracts across this country. We think that's significant and it's unfortunate. So this is a very significant thing that we are here to talk about tonight. It's not only employment but it's capability as well.

So we are going to talk tonight about the ramifications of this decision, why we think it was inappropriately made, and what we may consider to reverse this decision.

And with that I would like to yield to the gentleman from Kansas (Mr. Tiahrt), who been a stalwart and a champion on educating our colleagues about the importance of this, something we are going to talk about tonight at some length, which is the favorable treatment of Airbus by the European governments and why this has skewed this particular contract.

Mr. TIAHRT. I thank the gentleman from Washington for yielding. And I also want to thank Mr. Inslee for his leadership in trying to bring some common sense to the procurement process down at the Department of Defense.

Madam Speaker, Americans are outraged by the Air Force outsourcing our national security to the French. This contract award to a foreign manufacturer is wrong, and it makes us less, not more, secure.

As my chart to the left here shows, we should have known that we had a problem when the President's helicopter replacement, the VH-71, went to a foreign manufacturer. We should have suspected it again when the light utility helicopter went to a foreign manufacturer. And now with the KC-X program going to be a manufacturer, it's as plain as the nose on your face. We have three of the last four major contract awards now going to foreign suppliers.

Here's how this works: The Department of Defense and the Air Force really have bent over backwards to give this contract to the French, but they've been very sly. They first, as a foreign supplier, find an American front company, and then they employ tactics like waiving regulations that our Department of Defense gladly awards them. They use illegal subsidies. They employ illegal subsidies. And then they buy into defense contracts, knowing that further on down the line, there won't be the ability to have an American manufacturer beat them out in any competitive bid. And then further, as was pointed out by Mr. Inslee, they make promises in their proposals, and then the contracts are awarded by the Department of Defense, but they change their mind about the work content and they keep the work in Europe.

Let me just talk for a brief minute about why this was such a shock when this contract went to a foreign supplier. The Air Force tanker roadmap is a chart that was given to us by the Air Force. I sit on the Defense Subcommittee of Appropriations, and in December of last year, December of 2007, this was the chart that they said was their roadmap to replacing the tankers. On the left-hand side here, we have 2006. This is where this chart begins, fiscal year 2006, and it runs out to fiscal year 2007.

They have two tankers in our stock now. They have two versions of the KC-135. They have the older KC-135Es, which are the first ones to go out of the inventory. Next we're going to replace the KC-135Rs. "R" stands for the re-engine version of the KC-135. And at the bottom, we have our very largest tankers, the KC-10s, built on a DC-10 airframe, almost as large as a 747. But that's the larger airframe. This is the medium-range tankers, according to the Air Force.

The KC-135s, as you can see, in 2006 we started to take them out of the inventory. And as time goes on, you can see this little yellow triangle getting smaller and smaller. That means the KC-135s are going to Davis-Monthan Air Force Base into what we call the "bone yard." They're no longer flying.

We're still flying the KC-135s. The average age is about 45 years of age, and they need to be replaced. We have then the KC-10s. They're the newer version and the larger tanker.

So what the Air Force told us is that they were going to replace this KC-135 medium-sized tanker over the next 15 years. Actually, it's going to run about 20 years with all that's said and done on the current schedule. But we were supposed to start out here in 2011 by having them first delivered.

So when the contract was awarded, did we get a replacement for the KC-135? No. The Air Force bought an airplane larger than the KC-10. So, naturally, everybody was shocked all across America. And then when they found out that the KC-10 replacement is the KC-30, a variation of the Airbus A330, a French airplane, they were shocked and outraged. We're outsourcing our national security to the French.

So what is behind this decision? How could this possibly have happened? Well, if you look at the contract scenario, we find out that there were waived regulations, waived regulations [H1879] by our own Department of Defense. They waive them for our NATO allies. And if you go to the Defense Federal Acquisition Regulations, paragraph 225, it will tell you which of the 20 nations have waived regulations when they bid on defense contracts. Those 20 nations include the four ownership nations of Airbus and the parent company of EADS. They include the United Kingdom. They include Spain. They include France, and they include Germany. These are the regulations that are waived, and they're very costly, very expensive.

Let's just look at the first one on the list here: Cost Accounting Standards. Now, Cost Accounting Standards say basically that you have to include all the costs that it takes to make a product that you're going to supply to the Department of Defense. And if you miss a cost or shift costs in and out of a contract, it could be a violation of the Cost Accounting Standards with very high penalties. It could be determined that it was fraud, and people could go to jail. Or it could be determined that you tried to give the government the slip on some data, and you would be barred from doing business with the Federal Government.

You can't shift cost on cost accounting standards. They are very costly to comply with. You have to have people hired to keep track of all costs. They must track them, compare them, report them as far as their relationship with schedules. If you don't have to do it, like EADS, in the case of this tanker, then it's much cheaper as far as your proposal. So cost accounting standards were waived by the Department of Defense for EADS, but they were required by the Boeing Company.

Now what does this mean for the Boeing Company? It means they have to include all their costs, including health care costs. Health care costs that they pay for their employees, workmen's compensation costs that they pay to cover the employees are all included in these costs. They have to be included in their proposal. If you don't do it, it is a violation of the cost accounting standards.

But those costs are not in the EADS proposal. Health care costs, workmen's compensation costs are picked up by the government, so they don't have to pay for those. Again, that gives a lower bid to EADS for this kind of a cost.

Mr. INSLEE. Will the gentleman yield just for a minute?

Mr. TIAHRT. I would be glad to yield.

Mr. INSLEE. I want to point out about this cost. Even under the Air Force's own accounting, even with these what you may consider rigged accounting standards that Mr. Tiahrt talked about, even under the Air Force's accounting standards, they concluded that the 767 is about 24 percent more fuel efficient than the Airbus product. You're going to save massive amounts on fuel over the lifetime. In fact, the Air Force estimated the Airbus product will burn $30 billion more fuel over the lifetime, even under the rigged accounting standards.

So the point is that we need the Air Force from a taxpayer standpoint to be looking at the operational cost. We just had the executives of the five biggest oil companies today. Those oil prices are not going down any time soon. If anywhere, they are going up.

So this is why we are saying that the country, not just the place these planes are made, but the whole country has a stake in this to really look at the operational costs on that.

Thanks for yielding, Mr. Tiahrt.

Mr. TIAHRT. You make a very good point about the net cost to the taxpayer. Getting back to these accounting standards which you are pointing out, the net cost is very high to the taxpayer. If EADS violates the cost accounting standards, we will never know it because they don't have to report it. And the cost of reporting this, the Boeing Company had to include. So it's really a difficult time for any American company to compete with a European company when you waive this first standard.

The next standard is a specialty metal standard, called the Berry amendment. This is where our manufacturers are required to track from the time a metal is mined from the ground and processed, until it's riveted onto an airplane. Tracking. That means people are sitting somewhere at a desk and they are spending time trying to keep track of who is processing this and what procedures were put in place. It's very costly. But it was waived for the European manufacturers by our Department of Defense in DFARS 225, that's the Defense Federal Acquisition Regulations again.

The next one that was waived by the Buy American provisions. Buy American provisions basically say 50 percent of this product has to be made in America. Now the goal in this proposal for Northrop Grumman, the EADS proposal, said 58 percent was their goal. If you look at previous contracts with the Department of Defense, like the light utility helicopter, which EADS also won, their goal there was 65 percent. But they had some American suppliers in there that were included in the bid, and as a second thought EADS said, well, we have got a production line in Europe. Things are going pretty well. We think we will just keep this work here.

So there are companies in Kansas that were cheated by this. There was a Spirit Aerospace Manufacturing, which lost the fuselage of the helicopter. There was Command Aerospace, which lost the floor board of the helicopter. Then there was ICE, Incorporated, which lost the wire harnesses for the helicopter. All American work content in the proposal that was then awarded as a contract and then that work was pulled back to Europe.

When I asked the Army about this in an open hearing, their response was, well, we have no enforcement mechanism to make sure that these jobs remain in America. No enforcement mechanism. So we waive these kind of standards and regulations that would allow us the knowledge of where these jobs are actually going. And we will never know.

Mr. INSLEE. If the gentleman will yield.

So do I take it that in the current situation we would be issuing a contract for up to $40 billion with no enforcement mechanism to enforce the American content situation. Is that a fair statement?

Mr. TIAHRT. That is exactly right. This is a question that has been put directly to not only the Army, but also the Secretary of Air Force and the head of procurement for the Air Force. It's common knowledge over in the Pentagon they tell us these things and we evaluate them based on these jobs being in America, and low risk, but then there is really no way of enforcing if these companies decide to keep the jobs in Europe.

If you look at this very same contract, the air refueling tanker contract, the first five airplanes are currently planned to be built in Toulouse, France. Then they are going to change the manufacturing procedure and start taking parts and shipping them to Mobile, Alabama, to assemble them. This is a similar scenario to the light utility helicopter. When it came time to ship those jobs to America, they decided to keep them in Europe.

There's no guarantee in this contract that has been awarded by the Air Force that says, yes, you plan on doing this in Mobile, Alabama, but there's no enforcement mechanism to make sure the jobs actually come to America.

Mr. INSLEE. That's most disturbing because of that experience and because of reading that in France, they tell the French they are going to have 76 percent of the jobs in Europe. Then they come over in America and tell us they will maybe have 50 percent. This is one reason, just one of the reasons this contract has to be reviewed.

I want to mention one now just before I yield to Mr. Loebsack for a moment. There is another aspect of this that is outraging Americans, and certainly is in my State, and that is that we are issuing this $40 billion contract to a company that essentially one of the partners that the American Government itself says is acting illegally. Because according to our U.S. Trade Representative, who has initiated a legal action against these companies for receiving illegal subsidies, illegal subsidies that violate international law, and by extension, violate United States law, at the same time we have taken this almost unprecedented action to bring a case in the world courts, the World Trade Organization, against their illegal subsidies. That is one agency of the United States Government. Sort of the "cop on the beat" [H1880] blowing the whistle. And at the same time, another agency, the Air Force of the United States Federal Government is bailing them out of jail and giving them a $40 billion contract.

That is hard to explain to any American, particularly those in the 300 companies around this country in 40 States that are going to be losing jobs as a result of this. If this isn't a case of the left hand not knowing what the right hand is doing, one hand attempting to sanction these illegal subsidies, and I think anybody who reviews this would conclude there would have been billions of dollars of illegal subsidies to Airbus over the years, we will talk about those in detail, and then to turn around and reward them with $40 billion. They ought to be receiving a sanction from America, a punishment from America, some type of slap on the wrist, at least. Instead, they get $40 billion of taxpayer money. This is wrong by any sense, the code of the West, international trade treaties. This is something we all ought to be united about.

With this, I would like to yield to Mr. Loebsack from the great State of Iowa, who has a concern about this.

Mr. LOEBSACK. Thank you very much. I would like to thank the gentleman from Washington for organizing this Special Order hour on the award for the contract to build the next generation of air refueling tankers. I want to thank everyone who's here at this point speaking on this issue.

Needless to say, I was deeply disappointed that the KCX refueling tanker contract was not awarded to the Boeing team. Rockwell Collins of Cedar Rapids, Iowa, is a part of the Boeing bid and would supply the aviation and electronic sub systems on the KC-767 advanced tanker. The State of Iowa has a well-earned reputation, I believe, as a leader in innovation, and Rockwell Collins is at the forefront of the cutting edge technological development for which our State is known.

With 9,200 employees in the Cedar Rapids-Iowa City corridor, Rockwell Collins is the largest employer in the Second Congressional District in Iowa. The Boeing bid would bring 1,600 high-paying jobs to Iowa, most of them in the Second Congressional District, and would invest over $60 million annually in the State.

Equally important, it would put a program that is absolutely vital to our national security and the readiness of our armed forces in the hands of highly skilled Iowans and American innovators and manufacturers. I think that is an absolutely critical point to make.

Rockwell Collins employees are hardworking, they are dedicated, and they are highly qualified workers. They work each day to provide the men and women who wear our country's uniform with the equipment and the tools they need to safely carry out their mission. I am a member of the Armed Services Committee and I know the importance of the aerial refueling tanker to our ability to support, equip and provide medical care to our deployed men and women in uniform.

As the Representative of Iowa's Second Congressional District, I know firsthand the impact of putting thousands of jobs and tens of millions of dollars into Iowa. In light of this and our country's current economic state, I find it difficult to believe that the Air Force has elected to ship thousands of jobs overseas by awarding a key component of the United States Air Force to a heavily subsidized European industry.

The aerial refueling tanker contract award must serve the interests of the American people and American national security. I repeat that. It must serve the interests of the American people and American national security. The awarding of the tanker contract to Northrop Grumman and EADS will force the Iowa Air National Guard to use scarce resources to construct new hangars in order to accommodate the larger size of the EADS planes. The estimated cost for the construction of the new hangars would be roughly $45 million.

Moreover, the runways currently used by the Iowa Air National Guard are not able to withstand the weight of a fully loaded EADS tanker. Thus, new ramps and runways would have to be constructed. The total cost incurred by the Iowa Air National Guard to house the Northrop Grumman EADS plane would be roughly $50 million to $60 million.

I fear that the awarding of this contract to a non-U.S.-based company would not only send tens of thousands of American manufacturing jobs to Europe, it would put important defense manufacturing expertise in foreign hands. I am especially concerned that this would leave our country perilously dependent on foreign contractors for our most important national security needs. And this is unacceptable.

The aerial refueling tanker is critical to our national security. We all know that. I strongly believe that American defense should be in the hands of American workers. I urge the GAO to carefully evaluate Boeing's petition and to assure that our men and women in uniform have the best value and the best performing equipment.

I thank the gentleman from Washington for allowing me to speak.

Mr. INSLEE. We thank the voice of Iowa. This is important across the country. The jobs that Mr. Loebsack is talking about losing would not have been lost if the Air Force had considered the fact that these companies are receiving these illegal subsidies. And it's not just we three Congressmen talking about it, it is the executive branch of the United States, which has fully evaluated this and come to the conclusion these were illegal subsidies.

These were not just small. They received $1.7 billion in launch aid to develop the new A-350. They received $3.7 billion in launch aid for the A-380. That is why our U.S. Trade Representative has started this enforcement action, blown the whistle on these illegal subsidies. Frankly, it has been years later than it should have been. But we have finally done it. It's one of these great sort of black comedies to think in the year period when we finally blew the whistle after all of these years of abuse of these illegal subsidies that disadvantage American workers, that that same year the Air Force ends up giving a contract for $40 billion.

These subsidies are not just an issue of dollars, they are jobs in Iowa as well. I want to thank Mr. Loebsack. I would like to yield to Mr. Tiahrt.

Mr. TIAHRT. I thank the gentleman from Washington and the gentleman from Iowa. He is representing one of the 42 States that is impacted by this decision. Getting back to the statement that the gentleman from Washington, Mr. Inslee, said about cleaning up the act, there is a report that really highlights why it is so important that it is such a travesty that foreign corrupt practices is one of the regulations that is waived.

We can't track what EADS is doing when it comes to their interface with foreign suppliers and foreign countries. But there is a report that was put out by the Center for Security Policy in April 2007. The name of the report is: "EADS is Welcome to Compete for U.S. Defense Contracts—But First It Must Clean Up Its Act." Then it goes through and highlights some of the corrupt practices that EADS has been known for across the globe, and their problematic issues.

Issue number one, espionage, bribery and other dirty practices; issue number two, Russian ownership and influence of EADS; issue number three, trying to supply America's adversaries with weapons.

The report goes on, but in the section called "Bottom Line," it says the six things that EADS must do before they should be allowed to bid on government contracts.

Madam Speaker, those six issues are: Number one, resolve espionage problems; number two, correct the bribery problem; number three, remove the Kremlin from the company; number four, prevent other ambiguous or known bad actors from owning EADS stakes; number five, resolve the proliferation problem; and, number six, resolve anti-American workforce problems.

This is what the Center For Security Policy suggests to the Department of Defense and to Congress, it is a public document, that we should do before we should allow this European manufacturer to supply products for our defense. And we won't ever know what they are doing right, because the foreign corrupt practices regulations are waived by our own Department of Defense. That is another reason why this is such an outrageous practice.

Mr. INSLEE. We should point out that this law, this international law against subsidization, has not been waived by Congress. This is sort of a backdoor way to waive an international agreement.

We have an agreement that now we are attempting to enforce that would prohibit this illegal launching. "Launching" basically is a situation where a European government assists the private manufacturer, in this case Airbus, by giving them essentially loan guarantees or essentially free money. You give them a loan that they don't have to pay back if the airplane doesn't do well. That is an enormous subsidy, to give free capital, in essence, or low cost capital, when you are manufacturing an airplane. Of course, when you develop an airplane, there are billions of dollars in development costs. Well, if a company like Airbus can go to their governments in Europe and say give us a loan we don't have to repay if the airplane doesn't perform as expected, we don't make money on it, that is an enormous subsidy.

Europeans with Airbus have been doing this for years. We have international laws against that, and those laws are in effect national laws in America. But somehow it is just like we ignored these. It is like they didn't exist.

Congress certainly never waived those laws, the courts have never waived those laws, the President has never waived those laws, the American people have never waived those laws. But somehow the Air Force did not take into consideration these enormous subsidies, and that is why this thing, this contract, has an odor about it, where we don't take into consideration that violation of international and American law.

But I want to talk, if I can, about the capability of these aircraft too, because obviously we want the best possible airplane for the job. There is possibly no more critical infrastructure, certainly to our Air Force, than the ability to refuel our planes. This is the absolute spine of the whole skeleton of the Air Force, to have this refueling capability.

There has been sort of a propaganda war that has been waged by the Airbus folks to sort of suggest that the Boeing airplane wasn't up to the job, and I just want to point out some of the facts about this aircraft that I think it is important to realize.

First off, if you want to look at the only company in this bidding that has essentially ever built an air tanker and has been building them for 50 years for America, it is Boeing. This is the hometown team that has been doing it for decades successfully, and I think we should maybe start the discussion from that point.

Second, the airplane that Boeing bid has some very distinct advantages that somehow were not considered, one of which is that the Boeing airplane can service about twice as many airfields as the competitor. The reason is it can land in shorter, not quite as equipped airfields. It can land fully loaded in 811 airfields around the world, compared to the competitor at 408. This is a distinct advantage, considering we don't know why where the next conflict is going to be. We don't know what sort of developing world airfield we are going to use. The airplane that Boeing proposes can be serviced and can essentially use twice the number of airfields.

Second, and this is critically important, the Boeing 767 is 24 percent more fuel efficient. In these days of a crunch with fuel and global warming we have to be concerned with and the enormous increase in costs that the Air Force is experiencing, this ought to be taken into consideration. That adds up to $30 billion, a distinct advantage.

Third, and this is one that I think is worth mentioning, this sort of propaganda effort that was started by the Airbus folks to suggest that the Boeing Company didn't score well just simply doesn't comport with the facts.

There were several factors, the first of which is called mission capability. When they compete these, there is a very sophisticated way of evaluating these. On mission capability, the Boeing airplane scored blue, which means exceptional, and low risk in the area of mission capability. That is the highest possible rating and I think can be considered the most critical factor in the whole competition. The Air Force concluded that the Boeing airplane met or exceeded all key performance parameters, which are also called thresholds and objectives. The Air Force concluded that the Boeing product actually had significantly more strengths, also called discriminators, than the competitor.

So you had Boeing receiving the highest rating possible for mission capability, it met or exceeded all of what is called KPP thresholds and objectives, and it was graded as having significantly more strengths than the competition, and somehow came up on the short end of the stick.

This deserves not only GAO review, but it deserves Congress reviewing this. As folks know, this is being evaluated now under the protest consideration, and we know it will be looked at carefully. But, frankly, if this does not get the thorough review we want, Congress is going to be looking at this, because these numbers just don't add up to say this was the right decision.

On factor two, proposal risk, just kind of from a commonsense standpoint perhaps we can look at the fact that we have one bidder, Boeing, that has been doing this for decades. They have an airplane, the 767, in the air, providing tanker services, ready to go, against a product that is going to be manufactured in this multi-nation system. To me, that would create significant confidence in the folks that have been doing it and have a plane that is in the air. In fact, the Air Force rated Boeing's risk as low, as it should be.

Surprisingly, the competitor was also rated as low, despite to me obvious risk where you have a multi-country, multi-facility, multi-build approach, contrasted with Boeing's integrated approach to design, build and certify with the existing facilities. So, at worst it seems to me that there is certainly no advantage of the competitors in that regard.

I would like to yield to Mr. Tiahrt. I have several more factors, but I want to yield to Mr. Tiahrt because I know he has a great idea.

Mr. TIAHRT. I thank the gentleman from Washington.

When talking about risk, the Air Force has done studies as to what is the best manufacturing technology that we have when we are building a complex, single point of failure system like the tanker. They say the best way to do it is to have an integrated production line, where you build your commercial off-the-shelf item and integrate in that very same production line those things that you need to make this a unique product for the Department of Defense. That was what was employed by the Boeing company in their proposal to the Air Force for the KC-767 tanker.

What we find out after looking at and listening to the Airbus or the EADS proposal is that they had this disjointed thing, as the gentleman from Washington pointed out very well, multi-country, multi-manufacturing sites, starting four new facilities that have to be FAA certified and they have to find qualified workers for. This develops a tremendous amount of risk in the proposal that the EADS company was putting forward, as compared to what the Air Force actually asked for in their own studies.

Somehow in this convoluted process of trying to decide which product to buy, they overlooked the fact that the Air Force said this is what we wanted, an integrated production line. We didn't want a multi-facility operation in multi-countries. We wanted it all to happen in one place, where we could keep track of the product and the quality. And yet when it came time to risk, they gave an equal amount of risk to both companies. It just doesn't make any sense.

The other point that the gentleman from Washington made that I would like to add to is what is the net cost to taxpayers? There are some things that the Air Force follows in their Federal acquisition regulations as part of their cost evaluation process, but there are some things they don't consider. For example, they didn't consider outsourcing our national security. They are just based on their rules and regulations. They look at cost and their key performance characteristics, et cetera.

But if you look at other things that need to be taken into consideration in Congress, like how do we secure the national defense industry, the defense base, well, we have to take these things into consideration.

If you look at the $35 billion contract and say what is the real net cost to the taxpayers, the $35 billion contract we know is what was awarded. But if you looked at the fuel savings that was pointed out by the gentleman from Washington, the KC-767 is 24 percent more fuel efficient, and that saves taxpayers $30 over the life of this program. So you take your $35 billion contract and you have to subtract that from the Boeing bid. So what is the net cost to taxpayers? It is $5 billion.

Then you take the comparison of American jobs versus French jobs. One thing unique about French jobs is they don't pay any American income taxes, but American workers do. So you take the 19,000 lost aerospace jobs in America and say what would they have paid the Federal Government over the life of this program in the form of income taxes? Well, 19,000 workers, which is the difference between the two proposals, times about $11,000 a year, which is the average that an aerospace worker pays in federal income taxes, and you take that over the life of this program, it comes out to $8 billion.

So you have got $35 billion. You take away $30 billion worth of savings on the fuel and you get down to a $5 billion net cost to the taxpayer. Then you add back what you would get from the lost American jobs paying taxes if they were employed with the American contract than they would have gotten to pay these taxes. That is $8 billion. So the net cost is actually a $3 billion advantage.

In other words, if we would have issued this to a American company with American workers paying American Federal income taxes, and you take into consideration the fuel savings, it would have actually brought in $3 billion more in revenue in the net cost to the taxpayer than what it had under the circumstances that they had given it to the foreign supplier. Then you look at the lost revenue from corporate tax by having 90 perce