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Washington, D.C. – U.S. Senator John McCain (R-AZ) today wrote the following letter to President Obama expressing concern about the Administration’s decision to request that a federal court quickly reverse its decision to prohibit temporarily the Air Force and the prime contractor for its top space launch program from buying rocket engines from a Russian state-owned company.

 

Text of the letter is attached and below.

 

May 8, 2014

 

The Honorable Barack Obama

President of the United States

The White House

1600 Pennsylvania Ave, NW

Washington, DC 20500

 

Dear President Obama,

I write to express dismay about the Administration’s decision to request that a federal court quickly reverse its decision to prohibit temporarily the Air Force and the prime contractor for its top space launch program from buying rocket engines from a Russian state-owned company.  The court did so by finding that such transfers would likely violate Executive Order 13661, “Blocking Property of Additional Persons Contributing to the Situation in Ukraine,” and other trade restrictions that the executive branch has imposed.  In disallowing those purchases, the court also found that “the public interest and national defense and security concerns that underlie [that executive order] warrant issuance of a preliminary injunction in this case”.

Based on that ruling, on May 6, 2014, I sent a letter to Secretary of Defense Chuck Hagel asking why the Department of Defense did not ensure timely compliance with the executive order by that contractor, United Launch Alliance (ULA), and that program, the Evolved Expendable Launch Vehicle (EELV), with respect to continued business with NPO Energomash, a Russian state-owned company likely controlled by Russian Deputy Prime Minister Dmitry Rogozin, who your Administration has designated by name for targeted sanctions.  In fact, it took a private company—a possible new entrant to that space-launch program—and a federal court to ensure your Administration’s compliance with its own sanctions policy.  And now we learn that the Administration—led by the Justice Department with the support of the State Department, the Treasury Department and the Commerce Department—is quickly moving to dissolve that court’s ruling. 

This is a series of very strange and troubling decisions. Given your stated commitment to employ sanctions to punish and deter further Russian aggression in Ukraine, as well as the public interest and national security concerns that underlie your related executive orders, the Justice Department’s action, which seeks to ensure continued commercial relations between the U.S. government and a major Russian company that is likely covered by your order, is confounding.   

Notably, in support of the Justice Department’s motion to set aside the court’s decision, the Treasury Department cites its need to issue an “affirmative determination” that Mr. Rogozin controls NPO Energomash—a determination that the Treasury Department apparently has not made.  For its part, the Commerce Department merely defers to Treasury’s interpretation concerning individuals and enterprises falling under those sanctions. And the State Department explains that “no such determination has been made with respect to NPO Energomash” and that, therefore, purchases from NPO Energomash should proceed. 

While it is unclear whether Treasury intends ever to make the “affirmative determination” it cited,  given the likelihood that Mr. Rogozin does in fact exercise the requisite control, the Administration’s efforts to have the court reverse its order as Russian aggression in Ukraine continues is puzzling.  These actions represent steps to nullify, weaken, and limit the reach and effectiveness of the very sanctions you are relying on today to seek to address continued Russian intransigence in Ukraine.

The Administration’s actions also appear inconsistent with Air Force Chief of Staff General Welsh’s testimony to the Senate Armed Services Committee just this week that “the best answer for the United States of America [regarding the EELV program] is to have the option of an organic [rocket] booster.”  It is unacceptable that the United States is pursuing a legal recourse that would further its reliance on Russia as its supplier for rocket engines at this time and in a vitally important national security space program. 

With this in mind, I request that the Administration immediately take steps to ensure that Executive Order 13661 is given the full force and effect that the crisis in Ukraine demands.  I also ask that you explain how the Administration’s pursuit to reverse the court’s order granting a preliminary injunction in this case is consistent with the Administration’s policy both to pursue the domestic manufacture of rocket engines and to employ sanctions aggressively to punish and deter further Russian aggression in Ukraine.

  

Sincerely,

 

John McCain

United States Senator

 

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