The Taiwan Employment Act

As the nation's defense contractors pleaded with Defense Secretary Leon Panetta Tuesday against deeper budget cuts, senators were eying a proposed bill from two of their colleagues that would urge the Obama Administration to sell F-16 jet fighters to Taiwan for pretty much the same reason. Given the dire economy, it shouldn't come as a surprise: arms production is increasingly tilting from national security to jobs security.

The bill is authored by Senator John Cornyn, Republican of Texas. No surprise there - the F-16 is built by Lockheed Martin in Fort Worth, and it generates about 36,000 jobs in the Lone Star state. Senator Robert Menendez, R-N.J., whose state has 750 F-16-dependent jobs, is co-sponsoring the legislation. Its goal: "To provide Taiwan with critically needed United States-built multi-role fighter aircraft to strengthen its self-defense capability against the increasing military threat from China."

Taiwan has repeatedly and vainly requested permission to buy 66 F-16s since 2006. The bill says the U.S. government is obligated to sell Taiwan the planes under the Taiwan Relations Act, which requires providing Taiwan with arms necessary for its defense. The bill quotes the Defense Intelligence Agency warning that Taiwan's air force is growing older. But there's another important issue at stake here: U.S. jobs. The bill refers to a recent study that concludes:

…the Lockheed Martin Taiwan F-16 program would generate some $8.7 billion in output (gross product) and more than 87,651 person-years of employment in the US. Approximately 23,407 person-years of employment represent direct activity associated with the production and direct supply procurement process. The project would also yield almost $768.0 million in Federal tax revenues, as well as about $593.7 million to various State and Local governments.

Pentagon and congressional officials say the Administration is likely to propose improving Taiwan's older F-16s instead of selling them new ones by the end of the month. That will tick off the F-16s' backers on Capitol Hill, as well as the Taiwanese - but will no doubt please China.

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