British defense dilemma pits United States against Europe

Where do Britain's interests lie -- in ever closer defense ties with the United States or in stronger links with its European partners? Britain's ambivalence on how closely its loyalties should be attached to either the US or the European Community has surfaced in an unexpected quarter: a fight to save Westland, the financially ailing and last surviving British helicopter manufacturer.

The dispute as to whom will be the ultimate financial savior has sparked such an intense struggle within the British Cabinet that the Times (London) was moved to call it ``one of the most remarkable and bloody political and industrial confrontations for many years.''

One of the astonishing aspects of the dispute is the apparent determination of Defense Secretary Michael Heseltine to risk his political career by taking on Prime Minister Margaret Thatcher and her Cabinet in appealing vociferously outside the Cabinet for the European rescue package.

This not only reflects defiance of the cabinet style of government but is also sharply at odds with the Cabinet's earlier recommendation to abide by whatever decision the Westland board felt was in the company's best financial interests. The Westland board is committed to the offer of a minority stake in the company from United Technologies-Fiat. United Technologies is the parent company of Sikorsky.

At the moment, there doesn't appear to be any prospect of Mrs. Thatcher sacking Mr. Heseltine or of Heseltine quitting if he loses out. Yet political observers feel a situation cannot long endure in which a leading Cabinet minister is seen to be taking on the government on such a sensitive issue.

The critical moment has yet to arrive. It will come Jan. 14, when Westland shareholders will be asked to vote on the Sikorsky deal.

Despite intense pressure from the Europeans and from Heseltine, whose support outside the Cabinet appears to be much larger than had been originally anticipated, the Westland board appears resolved to go along with the Sikorsky-Fiat bid (the Fiat component is about 15 percent).

The geopolitical aspects of the struggle might not have been so starkly posed had the alternatives not been a straight choice between an ``American'' or a European rescue operation.

Inevitably in the resulting rhetoric of advancing their causes, the advocates of both sides have stressed the political hazards in either accepting a European bid and rejecting an American offer or vice versa.

This is how the respective supporters view the challenge in both geopolitical terms and defense:

Deal: Sikorsky is the world's biggest helicopter manufacturer and turns out excellent helicopters. Westland and Sikorsky have a proven track record of working together for 40 years. And British suppliers to Westland helicopters favor the Sikorsky-Fiat link. There are doubts about the commitment of European governments to unify Europe's four helicopter makers.

Against the American-led operation: Britain should be collaborating with its Common Market partners in building up a viable European defense industry to thwart US penetration of European markets. Britain's commitment to Europe is frequently in doubt, and acceptance of the European consortium would be an expression of good faith.

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