ACT I: THE PLANES ARE FALLING 

On January 13, 1999, a KC-135 Stratotanker with the Washington Air National Guard was on its way back to Geilenkirchen Air Base in Germany after a refueling mission. While the tanker was approaching the runway, its horizontal stabilizer, a wing-like structure attached to the tail section, spontaneously locked into an extreme “nose-up” position. The tanker abruptly pitched and became almost perpendicular to the ground. Then it stalled and crashed short of the runway. All four crew members died.

The Air Force grounded 350 tankers and inspected their stabilizers. Investigators never determined the cause of the malfunction, but for the Air Force brass the crash was yet another reason to replace the aging KC-135 fleet. The stabilizer was so antiquated that it was no longer commercially manufactured. Air Force crews had to reverse-engineer the design and then build new ones out of spare parts.

And there were other spectacular accidents. Four months after the crash, a tanker blew apart during a routine cabin-pressure test. Photos of the demolished plane ran in the military trade press.

By 1999, the typical tune-up cost $3.5 million to $4 million a plane, a fourfold increase from a decade earlier. On average, a tanker spent 400 days at a stretch in the maintenance depot for repairs, almost three times as long as in the 1980s. Crews were also exerting double the number of normal work hours to keep the planes airworthy. Tinker Air Force Base in Oklahoma, the primary depot for the KC-135s, had to turn tankers away because there was no place to put them. “They are stacked up like cordwood,” one official told the Air Force Times.

The tankers were also coming apart. Senior Air Force leaders visiting the maintenance crews watched as workers peeled the skin layers apart and powder fell out from the middle. Corrosion and fatigue were overtaking the planes.

“We were in a race between the cost of operating the aircraft and trying to find money to replace this stuff,” says Whitten Peters, then the Secretary of the Air Force. “If this were your car, you’d trade it in.”

But the Air Force faced a dilemma. As badly as the service wanted new tankers, the new F-22 stealth fighter topped its wish list. “The [Air Force] chief of staff came in to see the ranking member eight times in two years,” says one former staffer on the House Armed Services Committee. “Every time, the message was ‘F-22s.’ It was the Air Force’s end-all, be-all.”

Every new and expensive program—such as replacing the tankers—threatened to take money away from the fighters. But salvation was on the way, in the guise of a generous uncle.

Uncle Ted’s Idea
Ted Stevens, the senior senator from Alaska, had long been a booster of the Boeing Company. Not for reasons of constituency—the country’s largest aircraft manufacturer built most of its planes in Washington state, where it had an unflagging supporter in Representative Norm Dicks, whose beneficence toward his state’s largest private employer had earned him the title “the congressman from Boeing.”

But for Stevens, whose fellow Alaskans dubbed him Uncle Ted in tribute to his largesse with the pork barrel, the connection to Boeing—and aviation—was more personal.

Stevens joined the Army Air Corps a year out of high school, in 1943, and flew cargo runs behind Japanese lines in China and Burma. Decades later, when he became chairman of the Senate’s powerful Appropriations Committee, he grew incensed at the deterioration of the Air Force’s tanker fleet. According to one former service official, Stevens thought it a disgrace and a danger to those in uniform to ask them to fly planes coming apart at the seams. In the late 1990s, years before the Air Force brass made plans to replace the fleet, Stevens suggested a fast way to do it. Instead of buying the planes, the Air Force should lease them.

A formal competition could take two years. The Air Force would probably have to wait another three before the first planes arrived. Stevens thought it smarter to skip the first part of the process and lease existing commercial aircraft modified for military duty. For the cash-strapped Air Force, the math was obvious. Leasing tankers would cost more in the long run, but the up-front costs would be smaller and the payments would be spread out over time.

If anyone could grease the skids for a multibillion-dollar leasing deal—early estimates put the price around $20 billion—it was the man who held the government’s purse strings. Stevens’s staff on the Appropriations Committee wrote a draft lease. How it made its way into Boeing’s hands remains unclear. But in February 2001, Boeing approached the Air Force with an unsolicited offer to lease three dozen 767s—midsize wide-body jets put into service in 1982—for $124 million each.

That same month, Air Force officials said buying the planes would cost far less—about $52 million per tanker. That didn’t account for maintenance costs, but the lease, which would be run through a third party, clearly was the more expensive option.

In peacetime, replacing the tankers wasn’t a top priority. But Air Force officials warned that if the country went to war and had to deploy forces to a faraway battlefield, the strain would push the tankers to the breaking point. On the morning of September 11, 2001, hijackers flew a pair of Boeing 767s into the World Trade Center towers. Two more Boeing jets crashed at the Pentagon and in Pennsylvania.

America was at war, and the tankers moved to the front lines.