International Economic Law and Policy Blog

The Next Gambling Dispute?

As was widely reported yesterday, the EU is launching an internal investigation on U.S. online gambling laws, to decide whether to bring a WTO complaint:

The European Union threatened to lodge a complaint at the World Trade Organization over U.S. laws that bar gambling Web sites, saying they may break global rules by discriminating against companies based in the bloc.

U.S. authorities have targeted European companies for operating gaming sites, said the European Commission, which today announced an investigation into the U.S. practice. The U.S. hasn't taken action against domestic companies that offer similar services, said the commission, the EU's executive arm.

Here's the EU press release.

But wait, didn't the EU already agree on compensation in this case related to the U.S. withdrawal of concessions?  Once a settlement is reached with Antigua and Costa Rica, the countries who haven't yet settled, isn't the case over?  Maybe not, as the EU is concerned with prosecution for past gambling activities that occurred prior to withdrawal of the concessions.  From an EU "fact sheet" for the case:

Foreign companies are prevented from offering Internet gambling services in the US. The US authorities are investigating EU companies for services that they have offered in the past in the US. EU companies that had been active in the US have left the market, but this has not stopped the US Department of Justice (DOJ) from continuing to act against EU companies. In addition, EU companies argue that the DOJ has not been targeting US companies that were offering equivalent services.

The Remote Gambling Association (RGA) argues that the legal situation in the US as regards Internet gambling was unclear in the past. Despite statements by the DOJ that Internet gambling was not allowed, many local companies were actively supplying this type of service. In addition, the US had in the Uruguay Round undertaken legally binding GATS commitments to allow non-discriminatory access to its gambling market.

...

The Federal laws targeted by this complaint had already been condemned in a WTO dispute settlement case (WT/DS 285) brought by Antigua and Barbuda against the United States. However, the US did not comply with the relevant rulings, but announced instead its intention to withdraw for the future its GATS commitments on gambling and betting services in accordance with the procedures provided for in Article XXI of the GATS. The US is still negotiating compensatory adjustments in other sectors with affected WTO Members in exchange of this withdrawal. The EU and the US reached a deal on the compensation due to the EU on 17 December 2007.

The RGA argues that applicable US obligations would not disappear even after the completion of the current process of withdrawal of the United States' GATS gambling commitments. The reason for this is that the withdrawal would not have retroactive effects, that is, would only remove US obligations for the future, but not in respect of past events. In this particular case, the DOJ is only targeting past events (the Internet gambling offered by EU companies in the past) when US GATS commitments were in place. (emphasis added)

In related news on the gambling dispute, blogger Ed Brayton continues his quest to find out what's in the U.S. gambling settlements, with the EU and others.

Obama/Clinton and Boeing vs. McCain and Airbus

As if the Boeing vs. Airbus controversy on the Air Force tanker deal wasn't political enough already, with Obama and Clinton criticizing the decision to award the contract to a group that includes Airbus, now there's this:

Angry Boeing supporters are vowing revenge against Republican presidential candidate John McCain over Chicago-based Boeing's loss of a $35 billion Air Force tanker contract to the parent company of European plane maker Airbus.

...

... Boeing supporters in Congress are directing their wrath at McCain, the Arizona senator and nominee in waiting, for scuttling an earlier deal that would have let Boeing build the next generation of Air Force refueling tankers.

Whoever the Democratic nominee is, it seems likely that this will be an issue in the Presidential campaign, with the Democratic candidate criticizing McCain for "outsourcing" U.S. military aircraft.  Something along these lines, I would guess:

House Speaker Nancy Pelosi, D-Calif., echoing the thoughts of many congressional Democrats, sees McCain's role in a less positive light. She said the earlier tanker deal was "on course for Boeing" before McCain started railing against it.

"I mean, the thought was that it would be a domestic supplier for it," Pelosi told reporters. "Senator McCain intervened, and now we have a situation where the contract may be — this work may be outsourced."

When you combine this with McCain's uncompromising support for NAFTA, trade and globalization could be as big a deal in the general election as it has been in the Democratic primaries.

ADDED:  And now there's this:

The Associated Press reported that some of [McCain's] current advisers lobbied last year for the European Aeronautic Defence and Space Co., the parent company of plane maker Airbus. EADS and its U.S. partner Northrop Grumman Corp. beat Boeing Co. for the lucrative aerial refueling contract.

...

Two of the lobbyists working on the EADS account gave up their lobbying work when they joined McCain's campaign last year. A third, former Texas Rep. Tom Loeffler, lobbies for EADS and serves as McCain's national finance chairman.

A Compulsory Licensing Complaint?

Whenever I hear about compulsory licensing done pursuant to the TRIPS Agreement and related instruments, I wonder whether IP companies will lobby for a formal complaint against the practice.  It is permitted in principle, of course, but there is always the possibility that the applicable rules have not been followed.  IP companies can't be happy about compulsory licensing, which makes a complaint a real possibility.  On the other hand, a complaint could be a PR disaster.

I'm not sure I'm reading this right, but this article suggests that an EU complaint may be under way:

The EU, pushed particularly by Germany and France, recently said it would file a complaint against Thailand for breaking the international agreement on compulsory licensing.

Now, the article says "complaint," but does that mean a complaint under the DSU?  Or is it something more informal?  I'm not sure, and I can't find any other articles confirming this.

The other likely complainant is the U.S., of course, but it seems the U.S. has no complaint is in the works:

The Office of the US Trade Representative (USTR) has moved to quell rumours that it was on the verge of filing a complaint with the World Trade Organisation about Thailand's compulsory licensing of pharmaceuticals under the Surayud Chulanont government.

''Speculation about a WTO case is frankly surprising,'' the USTR said in a statement. ''Any such consideration would only happen after a thorough review of the consistency of such measures with WTO rules and extensive discussion with the Thai government, neither of which has happened.''

Reports of a WTO case emerged after the Biotechnology Industry Organisation (BIO) and the Pharmaceutical Research and Manufacturers of America (PhRMA) petitioned the US government, as part of the annual Section 301 intellectual property rights review, to designate Thailand a Priority Foreign Country.

The two groups had complained about Thailand for invoking compulsory licences. BIO alleged that the compulsory licences went well beyond the letter and spirit of the WTO's Doha Declaration provisions relating to health emergencies. PhRMA claimed Thailand did not meet all thresholds set under international agreements to issue compulsory licences.

UPDATE:  This article suggests there is no EU complaint coming after all:

However, Essential Action says that reports suggesting that the European Union is planning to file a case against Thailand at the World Trade Organisation are untrue. The group says that when asked a plea to the WTO was in the pipeline, an EU official stated that no challenge was or will be made and acknowledges that Thailand's actions are WTO-compliant.

A New Kind of Outsourcing

From The Onion (via Greg Mankiw), a new form of outsourcing:

(Let me just repeat, for those who didn't catch it, this is from The Onion).

The Zeroing (DS344) Appeal

Recalling Sungjoon's much commented on post here on the panel report in U.S. - Stainless Steel (Mexico), this is from the U.S. oral statement in the appeal of that report:

5. The zeroing reports represent a long-running dispute between the Appellate Body and panels – composed primarily of trade remedy experts – about the meaning of key provisions of the Antidumping Agreement. In their submissions, Mexico and several third parties have flayed the Panel for not adopting the Appellate Body’s findings in the various zeroing cases. While engaging in legal histrionics has dramatic value, the reality is that the Appellate Body recognized long ago in Japan – Alcoholic Beverages II that GATT and WTO reports are “not binding except with respect to resolving the particular dispute between the parties.” The Appellate Body has also indicated that panels are required only to “take into account” prior rulings on matters in issue. Here, the Panel carefully analyzed the Appellate Body’s reasoning in expanding a zeroing prohibition beyond average-to-average comparisons in investigations, and found that it could not agree. A reading of the Panel’s report will show that it responded in detail to each of the various rationales that have been put forward by the Appellate Body in its zeroing decisions. The Panel’s report reflects a sincere disagreement with the Appellate Body’s reasoning, not a lack of respect.

6. All of us want a strong WTO dispute settlement system that commands widespread respect and adherence. But no legal system can afford an unthinking adherence to precedent. Even in our common law system with its principle of stare decisis, the courts can and do reverse earlier rulings if they are convinced that a mistake was made. A legal system that cannot fix mistakes will lose credibility and eventually fall apart. Therefore, we urge the Appellate Body to approach this dispute with an open mind, and not to be cowed by emotional predictions by some of our friends that the world as we know it will end if some aspect of an earlier ruling is ever reconsidered. In view of the number of expert panelists that have disagreed with the Appellate Body’s previous findings on zeroing, and the criticism by respected academics of the Appellate Body’s zeroing rationales, it is simply not realistic or credible for our Mexican, Japanese, and European friends to try to shout down legitimate principled disagreement about whether the Antidumping Agreement and GATT 1994 Article VI contain a clear, broad-based prohibition on zeroing in all contexts.

The U.S. appellee's submission is here.  I couldn't find the other participant's/third participants' submissions online to get the other side of the story.

This whole case must have been a delicate one for the U.S. lawyers, who had to say things like this to the Appellate Body:  "The Appellate Body’s Interpretation of the Term "Margin of Dumping” Is at Odds with WTO/GATT Practice and the Ordinary Meaning of the Term."

More of the WTO Gambling Dispute in Domestic Law

The Gambling dispute has been great for opportunities to raise WTO law in domestic law.  Here's another example, from the Imega vs. Gonzalez decision, issued this past week by the U.S. District Court for the District of New Jersey, which involved a complaint against the Unlawful Internet Gambling Enforcement Act of 2006:

C. WTO Claims (Counts IV, V)

The plaintiff alleges that UIGEA is void because it is ultra vires of, and otherwise inconsistent with, the foreign trade obligations of the United States. But prudential standing considerations bar judicial review here. Although some treaty obligations may create a private cause of action, see Sanchez-Llamas v. Oregon, 126 S.Ct. 2669, 2680 (2006) (assuming, but not deciding, truth of proposition), that is not the case as to the Uruguay Round Agreements at issue here.  Indeed, the statute pertaining to the Uruguay Round Agreements precludes private actions: only the United States "may challenge ... [an] action or inaction by [a] department, agency, or other instrumentality of the United States ... on the ground that such action or inaction is inconsistent with [the Uruguay Round Agreements.]" 19 U.S.C. § 3512(c)(1)(B). The economic rights of private individuals are thus not within the "zone of interests intended to be protected by" the Uruguay Round Agreements. Oxford Assoc., 271 F.3d at 146. The plaintiff, as it has no cause of action under the WTO, cannot satisfy prudential standing as to its WTO claims.

Even if the Court were to consider the merits of the WTO claims, UIGEA "which was enacted in 2006" would trump any obligations arising under the 1994 Uruguay Round Agreements. See 19 U.S.C. § 3512(a)(1) ("[n]o provision of any of the Uruguay Round Agreements ... that is inconsistent with any law of the United States shall have effect"); see, e.g., Tag v. Rogers, 267 F.2d 664, 667 (D.C. Cir. 1959) ("has long been established that treaties and statutes are on the same level and, accordingly, that the latest action expresses the controlling law"). Also, WTO decisions are "not binding on the United States, much less this court." Corus Staal BV v. Dep't of Commerce, 395 F.3d 1343, 1348 (Fed. Cir. 2005) (quotes and cite omitted). The plaintiff's WTO claims would thus fail as a matter of law.

This decision doesn't seem to break any new ground, but rather just repeats various reasons why the court doesn't want to accept a defense based on WTO obligations.  Also, since this claim dealt with the UIEGA, it was more difficult to raise WTO obligations then some other cases, as the UIEGA was not part of the WTO claim.

Trade in Everything: New Zealand Fashion

I always hear good things about New Zealand and New Zealanders.  I didn't realize they were so stylish, though:

New Zealand is now home to a vibrant and steadily expanding fashion industry, with some 50 established labels, up from a handful ten years ago, half of which sell abroad. The World Trade Organisation says clothes exports were worth NZ$315m ($216m) in the year to June 2007, up from NZ$194m a decade earlier. The largest market is Australia, followed by America, Britain, Hong Kong and Japan.

Karen Walker, one of New Zealand's leading designers, showed a collection at New York's Fashion Week in February. Trelise Cooper's designs are sold in fancy American shops, including Saks Fifth Avenue and Fred Segal. And Pumpkin Patch, a childrenswear and maternity-clothes chain, moved into the British and American markets in 2006, and its success is prompting it to open more shops in American this spring.

Internet Gambling: Political Developments

Two things worth mentioning on the internet gambling issue.

First, here's a Congressional proposal to legalize, regulate and tax internet gambling:

US Congressman Jim McDermott has introduced web gambling legislation that would collect billions of dollars in new revenues.

A recent analysis by PricewaterhouseCoopers estimates the revenues at between $8.7bn and $42.8bn over 10 years.

The Internet Gambling Regulation and Tax Enforcement Act 2008 would ensure that taxes are collected on regulated internet gambling activities, strengthening the provisions of an earlier version of the bill introduced last year.

Second, Professor Nelson Rose speculates about which Presidential candidate would be most likely to permit internet gambling:

When the Democrats took control of the Senate, Harry Reid, senator from Nevada, became majority leader. So, land-based casinos, which want a study and law allowing them to operate internet casinos, can get those, if the President is a Democrat. If John McCain wins, Republicans will take over the Senate, so nothing will change. Insiders know that if Hillary Clinton is the nominee, Democrats will lose the Senate, even if she wins the presidency. There will then be four years of deadlock.

Assuming Barack Obama is nominated and wins, the Democrats will keep control of Congress and there will be a change in the federal law. It might come as early as 2009. More likely, it won't be until 2010, or even later. For political cover, there could be an objective, scientific study done first, that proves that internet gambling can be kept safe from hackers, protecting the "vulnerables" (children and compulsive gamblers), and that states that don't want to allow can be blocked.

Is that right that Obama would be most likely to legalize internet gambling?  I can see that there is an argument that a Clinton Presidency would mean a Republican Congress, as Professor Rose argues, but that seems far from definite.  I looked for explicit statements by the candidates on internet gambling, but couldn't find anything.

ADDED:  I found one thing in the Las Vegas Sun, setting out the candidates' views on internet gambling:

Clinton: Supports the industry’s position: to study Internet gambling to see whether it can be fairly regulated so that individuals can safely participate in it and American businesses can compete in the international market.

...

Obama: Worries that the Internet is “a Wild West of illegal activity”; supports a study of Internet gambling and supports regulation to address the worst abuses.

Venezuela to Block Colombian Trade and Investment

At its core, the Colombia, Ecuador, Venezuela crisis is more about politics than economics, but we may see a direct impact on trade and investment:

Venezuela is starting to block billions of dollars in Colombian imports and investment under orders from President Hugo Chavez, threatening economic havoc in both nations in response to a Colombian military attack on rebels hiding in Ecuador.

Chavez and Ecuadorean President Rafael Correa demanded international condemnation of Colombia's U.S.-allied government on Wednesday night, while Chavez predicted a sharp fall in the $6 billion in annual Colombia-Venezuela trade: "That's coming down."

"We aren't interested in Colombian investments here," Chavez said, standing beside Correa. "Of the Colombian businesses that are here in Venezuela, we could nationalize some."

I don't know if there are any Colombia-Venezuela investment treaties that would cover the investment part, but clearly WTO rules have a lot to say about a trade ban.  It has been a while since we've seen a GATT Article XXI defense argued, but presumably that's what Venezuela would invoke here.

China - Financial Information Services: The Complaints

The consultations requests in the China - Financial Information Services dispute are now available: EC request and U.S. request.  GATS claims (XVI, XVII and XVIII) and China's protocol of accession are the focus, but there is also a TRIPS claim in the EC request.  Here's a brief summary of some of the key aspects of the dispute, from the U.S. complaint:

China requires foreign financial information suppliers to supply their services through an entity designated by Xinhua News Agency ("Xinhua"). Xinhua has designated only one agent, China Economic Information Service ("CEIS"), one of Xinhua's commercial enterprises. China prohibits foreign financial information suppliers from directly soliciting subscriptions for their services, requiring that solicitation of subscriptions be done through the Xinhua-designated entity. China likewise prohibits users of financial information services in China from directly subscribing to services supplied by foreign suppliers. Furthermore, in order to renew their licences, China requires foreign financial information suppliers to provide the Foreign Information Administration Center ("FIAC"), a regulatory body within the Xinhua framework, detailed and confidential information concerning their financial information services and their customers along with a copy of an agreement with the designated agent. China also requires customers to provide FIAC detailed information regarding their financial information services contracts with foreign suppliers. These and other requirements and restrictions appear to accord less favorable treatment to foreign financial information services and service suppliers than that accorded Chinese financial information services and service suppliers which are not affected by these requirements and restrictions.

A BLANKET EXCEPTION FOR DEVELOPING COUNTRIES IN THE DOHA ROUND?

In the latest issue of BRIDGES, Joel Trachtman makes a provocative suggestion  in the context of the Doha Round, namely a "simple blanket exception stating that developing countries shall not be required to fulfil any commitment that is detrimental to their development or poverty alleviation". This blanket exception would be "conditional on a report by a team of professional development economists, appointed by the WTO" confirming the necessity of such an exception in particular instances.

"The sad truth is that neither the developing countries themselves, nor the WTO, nor the World Bank or the IMF, necessarily knows at this moment what specific measures will promote poverty alleviation in particular countries. How can a Doha Development Agenda proceed without this knowledge?...Literally at the stroke of a pen, it would be possible to ensure that developing countries are not obliged to fulfil commitments that do not promote their development. To do so, states should include in the Doha Round agreements a simple blanket exception stating that developing countries shall not be required to fulfil any commitment that is detrimental to their development or poverty alleviation. The key to ensuring that developing country commitments continue to be meaningful and valuable to developed countries – and to ensuring that developing country governments do not fall prey to their own protectionist special interests – is to make this exception conditional on a report by a team of professional development economists, appointed by the WTO."

There are certainly a lot of things to say about this proposition. My first impression is that there is a kind of contradiction in the argument. If (with all their staff of professional economists) neither the WTO, nor the World Bank or the IMF, necessarily knows at this moment what specific measures will promote poverty alleviation and development in particular countries, why would a team of economists appointed by the WTO have a better answer?  Do you imagine Baghwati and Rodrik together on this team? Would they agree about anything?

Finally, last but not the least, would this blanket exception apply to a country like China which considers itself as a developing country?  It is useful to remember here that the "developing country" label in the WTO is the result of a self selecting process. If you say that you are a developing coutry, you are considered as one! Would you imagine that other countries would accept a blank exception for China? 

DRAFT TEXT ON FISHERIES SUBSIDIES: THE SURPRISING EXPRESSION "NOT PROHIBITED SUBSIDIES"

It is interesting to note that – in contrast to the SCM Agreement’s distinction between the set of ‘prohibited’ subsidies on the one hand, and the set of ‘non-actionable’ and ‘actionable’ subsidies on the other – the draft text on fisheries subsidies uses only the concepts of ‘prohibited’ and ‘not prohibited’ subsidies.

What then is the exact legal status of ‘not prohibited’ subsidies in the draft text? Are such subsidies ‘non-actionable’ in the classic sense of the SCM Agreement?

On the basis of the structure of draft Annex VIII, it appears in fact  that ‘not prohibited’ fisheries subsidies remain potentially subject to various disciplines, and are therefore still ‘actionable’ if they produce certain adverse effects.

First, Article IV of the draft text entitled General Discipline on the Use of Subsidies stipulates that “[n]o Member shall cause, through the use of any subsidy [...] depletion of or harm to, or  creation of overcapacity” in respect of certain fish stocks. As indicated by the term ‘any’, every  fisheries subsidy, including a ‘not prohibited’ subsidy, falls within this general discipline. Moreover, since the draft text is an integral part of the SCM Agreement, it appears that SCM Article 5 relating to ‘actionable’ subsidies applies to the category of ‘not prohibited’ fisheries

subsidies. That article states clearly that “[n]o Member should cause, through the use of any subsidy [...] adverse effects to the interests of other Members.” Once again, the term ‘any’ implies that ‘not prohibited’ fisheries subsidies fall within the disciplines of Article 5 if they cause one of the adverse effects mentioned under this provision .

In sum, even if there is no real ambiguity about ‘not prohibited’ fisheries subsidies being nevertheless actionable, it would be perhaps make sense to use in the draft text an expression other than ‘not prohibited subsidies’. This would allow for more coherence with the rest of the SCM Agreement. Alternatively, a footnote could indicate that ‘not prohibited’ fisheries subsidies are still ‘actionable’ in the sense of Article 5 and, of course, under Article IV of the draft fisheries annex.

NB: For more analysis on the draft text on fisheries subsidies, my recent article in BRIDGES  might interest some readers.

Tariff Discrimination Against Poor Countries

From Ben Muse:

The Progressive Policy Institute points out that: The United States Collects More Tariff Money from Cambodia than from Britain (Trade Fact of the Week, February 20):

Some of our highest tariff rates are imposed on goods from some of the poorer countries.  "...countries which make cheap and simple clothes, shoes, and luggage face a far more restrictive American trade regime than the rest of the world."  So we end up taxing goods from less developed Cambodia an average 17% of their value, while goods from the affluent U.K. are only taxed 0.7% of their value.

The Progressive Policy Institute has talked about this issue many times in the past.  When I heard about it originally, I wondered, isn't there some WTO claim that Cambodia and others could make based on this situation?

A pure MFN claim would likely fail, of course.  The products facing the different tariff treatment are not "like," and that would probably be the end of it.

But what about a non-violation nullification or impairment claim, perhaps arguing that the benefits of MFN are being undermined by structuring tariffs in a way that, on the whole, even if not for specific products, certain countries are favored over others?  Non-violation claims are always difficult, even where it is a tariff concession being undermined.  Where it is a substantive obligation, such as MFN, that is being undermined, it's an even harder cae.  Nevertheless, it might be worth a try.

Alternatively, maybe the focus could be on whether the objectives of Part IV of the GATT (e.g., those in Article XXXVI:1) are being impeded?  There is even less jurisprudence here than with the non-violation nullification or impairment claim, though.

Clearly, such a complaint would require some novel legal theories.  But whenever I come across these statistics, it strikes me that there could be something here.  Even if the legal claim failed, it might help draw attention to a situation that many people consider to be unfair.

Bhagwati on Obama vs. Clinton

In the FT, Jagdish Bhagwati writes:

The Russian proverb goes that, if you are looking for a good son-in-law, you would not ask whether he drank but only how he behaved when he was drunk. Similarly, no Democratic candidate during the primaries can be anything but a protectionist. The only question is: of the two, which is likely to be friendlier as president to the cause of multilateral free trade? Careful scrutiny suggests that the odds are in favour of Mr Obama.

There are substantive points in the article as well (follow the link), but I enjoyed this intro to the piece.

The China Financial Information Services Dispute Is Here

The U.S./EU complaints against alleged Chinese restrictions on financial services are now official.  From USTR's press release:

The United States maintains that China’s restrictions and requirements limit the ability of foreign suppliers of financial information services to conduct business in China and place them at a competitive disadvantage in the marketplace. The apparent conflict of interest of China’s regulatory authority compounds these issues. As such, China appears to be acting inconsistently with several WTO provisions, including Articles XVI and XVII of the General Agreement on Trade in Services as well as commitments made by China in its WTO accession agreement.

Here's a USTR fact sheet as well.

From EC DG Trade's background memo:

The relevant Chinese measure appears to breach China's GATS commitments on national treatment and market access, which require that foreign companies can operate in China and are not treated less favourably than local ones. It is also contrary to obligations not to cut back on existing rights for companies and to provide regulatory independence, which China committed to ensure at the time of its WTO Accession in 2001.

The official WTO consultations request documents should be available later this week.

ADDED:

Who are the companies that are the major players in the industry?  AFP reports:

Financial information services, the subject of WTO trade complaints against China by the US and European Union, are dominated by US firm Bloomberg and Canadian-British Thomson-Reuters in the process of merging.

The two heavyweights, each with a third share of the global market, are trailed at a distance by three US companies and one Swiss firm, according to Inside Market Data, which reports on the global financial market data sector.

US-based Interactive Data, owned by British group Pearson, is the closest runner-up, with a five percent market share.

Dow Jones, bought last year by News Corporation, holds a three percent slice, as does US rival Factset. Switzerland-based Telekurs has a two percent share.

Something New to Demagogue About

All of this NAFTA bashing is getting tiring.  Isn't there something else to demagogue about?  Hey, how about this:

As has been widely reported, the Air Force stunned almost everyone yesterday by deciding to award its huge, $35 billion contract for new airborne refueling tankers to a partnership formed by Northrop Grumman, the Los Angeles-based company, and EADS Inc., the European maker of Airbus airliners.

Boeing, headquartered in Chicago but with a large workforce in Washington State, was the big loser. Boeing had said that if it got the contract to build the new tanker based on its 767 airliner, it would provide enough work to keep 40,000 U.S. workers busy.

The article notes helpfully:

Because of the jobs issue, this Air Force decision seems tailor-made for Sen. Barack Obama and Sen. Hillary Clinton who in their increasingly populist appeals have made the loss of American jobs a major presidential campaign issue, especially as they compete for labor votes during the primaries.

With Obama being from Illinois, and Boeing having its headquarters in Chicago, we could be hearing about this soon.

UPDATE:

Well that didn't take long, although in fairness it was a somewhat measured response:

Sen. Barack Obama expressed his disappointment Sunday that Northrop Grumann and the parent company of Europe’s Airbus beat out Chicago-based Boeing Co. for a contract worth up to $40 billion for the next generation of U.S. Air Force refueling tankers.

Obama said it was hard for him to believe “that having an American company that has been a traditional source of aeronautic excellence would not have done this job.” He preempted his comments by saying that he had not examined the deal carefully.

MORE: From Hillary:

As Air Force officials met with angry members of Congress, presidential candidate Hillary Clinton said in a statement, "I am deeply concerned about the Bush administration's decision to outsource the production of refueling tankers."

New York Democratic Sen. Clinton said it was "troubling" that the contract would go to "a team that includes a European firm that our government is simultaneously suing at the (World Trade Organization) for receiving illegal subsidies."