Key Issues

AIA Aero Blog

Congress Passes TPA Legislation

Passage this week of Trade Promotion Authority (TPA) by Congress is a major step forward for U.S. manufacturers.  AIA applauds the members of Congress who shepherded the bill through to passage and thanks them for their leadership.

TPA establishes concrete rules for international trade discussions with our economic partners throughout the world.  It allows the Executive Branch to negotiate on behalf of the U.S. for strong trade agreements that are in our best interests. It also retains Congress’ constitutional authority to review these agreements and provide an up or down vote, without amendments, for passage. This process encourages our trade partners to put their best offers on the table for potential agreements like the Trans-Pacific Partnership and the Trans-Atlantic Trade and Investment Partnership.

AIA has strongly and consistently advocated for increased U.S. government support for trade and exports.  In May, we sent a letter to leadership encouraging passage of TPA.  Read the letter here.

As one of the largest economies in the world, the United States benefits considerably from free trade, including the U.S. aerospace and defense industry. Trade agreements provide increased access to overseas markets, and help tear down trade barriers. This creates a level playing field for U.S. exports, which creates U.S. jobs and stronger productivity growth.  The U.S. aerospace industry directly benefits from the increased passenger and cargo air traffic, and our defense industry benefits from the closer economic ties with key security cooperation partners and allies.

The Hill Publishes AIA, Huntington Ingalls EX-IM Bank OpEd

As the June 30 deadline for the needed reauthorization of the Export-Import Bank of the United States approaches, AIA today placed an OpEd “Re-authorize Ex-Im Bank to keep a level playing field,” in The Hill newspaper.  The piece was co-authored by Mike Petters, president and CEO of Huntington Ingalls Industries and AIA president and CEO Dave Melcher.  It draws a connection between the collapse of domestic commercial shipbuilding in the 1980s after President Reagan terminated the Construction Differential Subsidy Program and our current situation with the ExIm Bank.

Re-authorize Ex-Im Bank to keep a level playing field

By Dave Melcher and Mike Petters

If you think of the global marketplace as a competitive playing field, it makes sense to think of the government as a referee; its job is to keep the field level for U.S. companies.

Since it was founded in 1934, the Export-Import Bank of the United States is one tool the federal government has used to maintain American competitiveness. Congress must reauthorize the bank’s charter before it expires on June 30, or we are in danger of losing the field entirely.

On occasion, the government has supported U.S. manufacturers against subsidized foreign competition and ensured that a stable industrial base exists for national security purposes.

For instance, at one time, the U.S. government maintained programs designed to preserve U.S. commercial shipbuilding competitiveness. The government offset a percentage of the difference in the cost of commercial ship construction in U.S. shipyards versus foreign shipyards that received large subsidies from their governments.

The cancellation of such programs in 1982 brought on the collapse of large commercial shipbuilding in the U.S., and a vital part of our industrial footprint was lost. We, as a nation, failed to maintain a level playing field in the global commons.

In the 1970s, commercial shipbuilding filled a gap caused by the decline of U.S. Navy work after the end of the Vietnam War.

As the 1980s began, American shipyards employed 187,000 people on all three coasts and the Great Lakes.

After 1982, the U.S. yards became a one-customer industry, and the structure of the market shifted to meet the requirements of the military.

This meant that the 1980s saw the industry shed 40,000 production jobs. It also resulted in the permanent loss of commercial shipbuilding capability and, ironically, inadvertently made the industry more dependent on government, rather than less.

The primary mission of the Ex-Im Bank is to guarantee loans against default, enabling U.S. manufacturers to access foreign markets where the potential customer may not be able to secure financing in the world financial markets without the collateral of a guarantee.

The Ex-Im Bank allows U.S. manufacturers to sell heavy construction equipment, airplanes, engines and thousands of other American-made products to foreign customers who would otherwise turn to our European and Asian manufacturing competitors.

These foreign companies rely heavily on their own national export credit agencies similar to the Ex-Im Bank.

Many of these sales also carry the benefit of sustained aftermarket sales and support opportunities for small and medium-sized U.S. companies. Losing these sales will mean not only lost jobs but also lost capabilities as companies retool their enterprises to focus on more lucrative business lines. This loss of expertise in the aerospace and defense industrial base poses a threat to future capabilities and innovation, potentially risking our ability to respond to a national security crisis.

American manufacturing is still the best in the world, and the Ex-Im Bank facilitates the sale of our products in the global community. In fact, more than 90 percent of customers for American-manufactured products live outside the U.S. The Ex-Im Bank provides our manufacturers the opportunity to compete for their business.

Concern over the size of the federal government is an important matter to debate, but the notion that the Ex-Im Bank is a large and unnecessary federal agency is unfounded.

It is self-funded from fees generated by its loan guarantees and actually returns a profit each year to the U.S. Treasury.

Given the opportunity to compete fairly, American manufacturing can succeed in any industry. The key is a fair and level playing field, and programs like the Ex-Im Bank provide it. American manufacturers cannot afford to lose this type of critical government support.

Reauthorization of the bank’s authority remains a necessary tool for American exporters to succeed in their battle for global competitiveness.


TARC at the Paris Air Show - Day Two

Team USA reviewing their notes before heading into the presentation portion of the International Rocketry Challenge

The RCS Engineers from Russellville, Alabama, had a great first day at the Paris Air Show. Thursday was day one of the International Rocketry Competition, kicking off the two-day event with the presentation portion of the contest.

All three student rocketry teams – from the United States, the U.K. and France – had a presentation and Q&A session with a panel of international judges. The purpose of the presentation portion of the contest is to evaluate the students’ ability to effectively communicate their technical knowledge about rocketry and their approach to design and testing.

After the team finished their presentation, the Engineers had the opportunity to tour the DOD corral and American aircraft on display for the show.  

RCS girls Chelsea, Katie and Cady

The team meeting with navigator and pilot of the U.S. Air Force’s hurricane hunting aircraft, the WC-130.

Cristian, Andrew, Niles and Evan touring the Army’s CH-47 Chinook helicopter.

Cristian learning the ropes of piloting the Army’s Apache Longbow Helicopter.

RCS Engineers with crew members of the Navy’s P-8 submarine surveillance aircraft.

RCS students meeting with AIA’s new president and CEO Dave Melcher at the association chalet.