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Boeing’s Max Crisis May Turn Pliant Congress From Friend to Foe

Ryan Beene and Courtney Rozen

(Bloomberg) -- Boeing Co. President Dennis Muilenburg faces lawmakers this week outraged over a pair of disasters that raise questions about the safety of the company’s marquee jet and could result in tightened oversight of the world’s biggest planemaker.

Muilenburg will testify before House and Senate committees overseeing aviation starting Tuesday, one year from the date when a Lion Air 737 Max plunged into the Java Sea, killing all 189 people on board. It will be the first time Muilenburg takes questions from lawmakers since the crash and a subsequent one by an Ethiopian Airlines 737 Max that led to the worldwide grounding of the company’s top-selling and most profitable passenger jet.

“The certification of the 737 Max raises serious questions, questions that go right to the heart of industry capture of government regulators,” said Senator Ted Cruz, the Texas Republican who chairs the Senate Commerce Committee’s aviation panel. “I expect the Commerce Committee to press the Boeing CEO vigorously on why those mistakes were made.”

The hearings will test the strength of Boeing’s relationships in Washington, where the company is seen as an American success story. It’s also become a power player due to its lavish contributions to politicians of both parties and an army of lobbyists that advance its commercial and military business lines.

Political contributions from Boeing-affiliated political action committees and individuals more than doubled over the last decade to $4.3 million in the 2018 election cycle, according to figures from the Center for Responsive Politics, which tracks political funds. Boeing has emerged as the transportation sector’s largest contributor in the 2020 election cycle by giving nearly $1.2 million, more than FedEx Corp., Delta Air Lines Inc. and General Motors Co.

A change in the company’s reception on Capitol Hill could ultimately threaten a loss of cherished privileges as lawmakers re-examine regulatory oversight.

For example, lawmakers have indicated they want to ask whether Boeing had too much sway in certifying the 737 Max through a longstanding program at the U.S. Federal Aviation Administration that deputizes company employees to issue safety approvals on the agency’s behalf. A report released Friday by Indonesian investigators highlighted the role of designees in approving the 737 Max design, including what investigators have flagged as a key vulnerability in the jet’s flight controls that malfunctioned during the fatal crashes.

In both accidents, erroneous data from a single weather-vane like sensor caused a new flight control on the 737 Max to repeatedly push down the plane’s nose until pilots lost control. Design flaws in that system, known as the Maneuvering Characteristics Augmentation System, contributed to the crashes, as did lapses at the airline.

In a statement Friday responding to the Indonesian investigators’ final report, Boeing said the 737 Max and its software have undergone an “unprecedented level of global regulatory oversight, testing and analysis,” and that the company has redesigned the MCAS system to prevent a repeat of what happened in the two crashes.

“Safety is an enduring value for everyone at Boeing and the safety of the flying public, our customers and the crews aboard our airplanes is always our top priority,” Boeing said in the statement.

Earlier this month, a panel of global aviation regulators found that the FAA had little awareness of MCAS, and ultimately delegated safety-critical elements of the system to Boeing under the designee program. The review also found evidence that Boeing exerted “undue pressures” on those employees. Boeing has said it is reviewing the panel’s recommendations and will work with the FAA to improve the aircraft certification process.

After repeatedly pushing the FAA to expand the use of so-called designees, lawmakers have begun to reconsider the program, including Representative Peter DeFazio, the Oregon Democrat who chairs the House Transportation and Infrastructure Committee, before which Muilenburg will testify on Wednesday. Curtailing the ability of Boeing to use designees could delay the already lengthy certification process for major new aircraft.

“My job is to fix the law.,” DeFazio said. “The law failed.”

The New York Times reported Sunday that Congress handed over even more responsibility for certifying safety to airplane manufacturers in legislation passed weeks before the Lion Air jet crashed. The newspaper reported that Boeing and its allies pushed for the measure over the objections of the FAA.

DeFazio’s committee opened an investigation into the 737 Max in March, days after the second plane crashed. The panel has since received hundreds of thousands of records from both Boeing and the FAA about the design, development, and certification of the plane, findings that will inform their questioning Wednesday. The committee’s top Republican, Missouri Representative Sam Graves, is also a pilot, giving him a deeper understanding of the plane’s technical features.

The panel’s probe has found indications Boeing employees were subjected to significant pressure by company executives to maintain production schedules and achieve key goals for the jet, such as avoiding additional simulator training for pilots, DeFazio said in a recent interview.

Among documents the panel has obtained are Boeing’s original promotional materials for the 737 Max, written while the plane was still being developed, that promised that pilots would not need to be re-trained to fly the jet, DeFazio said. In addition, DeFazio said Boeing’s contracts with Southwest Airlines included a provision where Boeing “essentially would pay a rebate of $1 million per plane if pilots had to have” additional training in the simulator, he said.

The Lion Air crash report “sadly confirms many of the findings of my Committee’s investigation of the issues surrounding the 737 Max,” DeFazio said in a statement on Friday. “It’s clear that reforms will be needed to ensure that future safety-critical systems don’t create single points of failure that bring down new commercial aircraft designs.”

The National Transportation Safety Board found that Boeing’s evaluation of MCAS underestimated the risks and difficulty for pilots in the event of a malfunction like what occurred in the two deadly crashes. Recently released instant messages between two Boeing pilots raised further questions were raised about whether Boeing was aware of MCAS-related safety issues as it was seeking certification from the FAA.

In the messages, a senior Boeing pilot in 2016 told a colleague he’d unknowingly lied to regulators about how MCAS functioned after experiencing a rocky test of the system in a flight simulator. That same pilot later told FAA officials that MCAS was benign and reminded them to remove references to MCAS from flight crew materials.

After the messages became public, Boeing said it was investigating the circumstances of the messages and that it would share those details with the authorities.

The pilot’s attorney says his client wasn’t hiding anything and that based on everything Forkner knew at the time, “he absolutely thought this plane was safe.” He said his client was referring to a problem with the simulator he was using to test MCAS, not MCAS itself.

Peter Goelz, a former NTSB managing director who’s now an aviation safety consultant, said the messages will all but guarantee Muilenburg will face tough questions in both chambers.

“I think the Senate is going to be obligated to take a hard stand with him,” following the messages, Goelz said.

Representative Rick Larsen, a Democrat from Washington State, said the documents raise questions about the FAA’s oversight of the company.

The reports into the 737 Max have made clear that “the method by which the FAA certifies aircraft is itself in need of repair,” Larsen, whose district includes Boeing’s campus in Everett, Washington, said in a statement Friday.

With some 23,000 current and former Boeing employees in his district near Seattle, Larsen could be expected to be more deferential to the company. But as chairman the House Transportation panel’s aviation subcommittee, Larsen said ensuring safety is critical to ensure the economic vitality of those constituents.

“A successful aviation economy really does depend first and foremost on people feeling safe about flying,” he said. “And if they don’t feel safe, none of it else matters.”

To contact the reporters on this story: Ryan Beene in Washington at rbeene@bloomberg.net;Courtney Rozen in Washington at crozen4@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth Wasserman

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