Falklands: Why The UK Builds Carriers !

Wednesday, April 2, 2008

Falklands: Why The UK Builds Carriers

Gotta wonder if BAE Systems, the prime contractor for the troubled (and seemingly on the verge of being cancelled) UK two-aircraft carrier project is donating to Argentina President Cristina Kirchner's Political Action Campaign. Why?

Because Argentine President doing all she can to get the UK to build 'em both:

"President Cristina Kirchner said during a Veterans Day and Victims of the South Atlantic War remembrance that the efforts of those Argentine troops who lost their lives in the short-lived war with Britain over the islands must not be forgotten."

Both the Queen Elizabeth Class Carriers will get built and some additional F-35B will get bought if the Argentine President keeps saying stuff like this:

"The sovereign claim to the Malvinas Islands (Argentina's name for them) is inalienable,"

Of course that kind of talk makes it sorta difficult to do this without carriers:

"Britain is preparing territorial claims on tens of thousands of square miles of the Atlantic Ocean floor around the Falklands, Ascension Island and Rockall in the hope of annexing potentially lucrative gas, mineral and oil fields, the Guardian has learned."

So, economically, loosing a carrier would be quite the blow. But, in terms of more immediate, smaller-scale losses, the impact upon BAE Systems would be tough to survive.

And for BAE, paying a far-off politician to insure the carrier program goes forward might seem, in some boardroom circles, a fine strategy.

Look at the record. BAE has not, apparently, been one of the most forthright, squeaky clean companies. And the company might have...err...developed something of a habit of using the purse in creative ways. From the LA Times, June 15, 2007:

"The Guardian newspaper in Britain reported Thursday that the Justice Department was preparing to open an investigation into BAE, and that it would cover its weapons sales to Saudi Arabia. One federal law enforcement official told The Times on Thursday that the probe had already begun, and that it was more extensive.

"It's not just Saudi payments that are an issue here," but BAE's aerospace and weapons deals with numerous other countries, said the official, who spoke on the condition of anonymity, citing the sensitivity of the ongoing investigation. Authorities are "looking broadly; it's a companywide thing."

BAE confirmed last month that it faced investigations of its business dealings in Romania, South Africa, Tanzania, Chile, the Czech Republic and Qatar. The law enforcement officials said BAE-related payments in Argentina, the British Virgin Islands and other countries also would be examined."

And then there's this, from the September 15 2005 Guardian:

A Chilean judge, Sergio Muñoz, is pursuing Gen Pinochet on allegations of tax evasion. Last month he made successful court applications in the US to obtain banking records. They disclosed huge sums of cash flowing into banks including the then Miami branch of Coutts. Coutts operated accounts, which Chilean prosecutors say are linked to Pinochet, from 1993 to 2004, although the bank has now sold out to a Spanish bank, Santander. Coutts said : "We have no reason to believe our Miami affiliate did anything inappropriate by reference to the banking requirements at the time."

According to the Chilean documents, BAE made payments into Coutts accounts under its own name, and under that of Red Diamond Trading, an offshore entity which does not appear on BAE's published accounts. Documents obtained by the Guardian show it has been used since 1998 to funnel covert commission payments for aerospace deals to Argentina.