Inspector General report says Boeing shielded key 737 Max details from FAA
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Wide-scale change to ODA in the works??
In the tragic aftermath of the two accidents, public scrutiny of the ODA process was growing in intensity well before the DOT I.G. report. A main example was the NYT article a few months into this saga which reported in some detail how Boeing had pressed the Congress to maintain if not expand its free-rein in the process, as part of the FAA Reauthorization.
Yet count this SLF as one who finds greater momentum for structural change in the I.G. report than before, if for no reason other than the fact both Congressional committees are preparing legislation to revisit what was done in the reauthorization bill. So the history about non-compliance, in this context, sets the stage for the more dramatic problems revealed by the two accidents. For convenience of thread readers for whom a close reading of the report is unwanted, here is the segment on past issues, from the section "Results in Brief" (p 9-10):
"in 2015, we reported on FAA’s lack of a risk-based oversight approach to ODA. In addition, FAA identified concerns regarding the quality of ODA certification documents that needed to be addressed. In December 2015, FAA and Boeing signed a Settlement Agreement, and Boeing paid a civil penalty of $12 million regarding violations of Boeing’s quality control system and insufficient certification documents. FAA’s subsequent oversight found that Boeing has not yet resolved all the identified issues, including improving its identification and resolution of the root causes of non-compliances with FAA requirements. During this time period, Boeing and FAA also identified concerns about undue pressure on ODA personnel at multiple Boeing facilities, which culminated in FAA issuing a formal compliance action against Boeing in November 2018. Boeing’s response to this compliance action remains ongoing."
What's the most valid way to reconfigure the ODA process? - that's a hard topic. The G.C. memo appended to the I.G. report notes that as part of FAA's other corrective initiatives, it is giving attention to SMS (Safety Management System) as well as "Just Culture" -- this is separate, per the General Counsel, from what may be in the works with regard to ODA.
But then Mr. Bradbury continues and notes that FAA is "developing a new policy to ensure appropriate FAA oversight of ODA programs". (p47) In that segment the G.C. invokes specifically the Administrator's statement that delegation is a privilege and not a right, and further notes that the new policy will take account of what Mr. Bradbury calls "any history of undue influence on ODA decision-making." And the policy also will take account of the additional work to be done by the I.G. as well as input from a group called the Expert Review Panel, as established by the reauthorization bill (section 213). As a kind of "watch this space" item the G.C. memo points out that "FAA expects to have the draft policy prepared for public comment in the coming months." Certainly a wealth of aviation safety community people and groups will anticipate offering such comments.
Beyond those steps, the G.C. writes that FAA is establishing an ODA Office to be part of its Aviation Safety Organization and gives some context for what it will do and how it will be initiated.
I don't know what the reauthorization bill actually says about the Expert Review Panel, and "politics" always can intrude on what otherwise would be a very technically virtuous process, but even as I am reading the detailed sections of the I.G. report closely, it sure seems as if some very serious people at FAA are motivated plus devoted to right the ship.
Yet count this SLF as one who finds greater momentum for structural change in the I.G. report than before, if for no reason other than the fact both Congressional committees are preparing legislation to revisit what was done in the reauthorization bill. So the history about non-compliance, in this context, sets the stage for the more dramatic problems revealed by the two accidents. For convenience of thread readers for whom a close reading of the report is unwanted, here is the segment on past issues, from the section "Results in Brief" (p 9-10):
"in 2015, we reported on FAA’s lack of a risk-based oversight approach to ODA. In addition, FAA identified concerns regarding the quality of ODA certification documents that needed to be addressed. In December 2015, FAA and Boeing signed a Settlement Agreement, and Boeing paid a civil penalty of $12 million regarding violations of Boeing’s quality control system and insufficient certification documents. FAA’s subsequent oversight found that Boeing has not yet resolved all the identified issues, including improving its identification and resolution of the root causes of non-compliances with FAA requirements. During this time period, Boeing and FAA also identified concerns about undue pressure on ODA personnel at multiple Boeing facilities, which culminated in FAA issuing a formal compliance action against Boeing in November 2018. Boeing’s response to this compliance action remains ongoing."
What's the most valid way to reconfigure the ODA process? - that's a hard topic. The G.C. memo appended to the I.G. report notes that as part of FAA's other corrective initiatives, it is giving attention to SMS (Safety Management System) as well as "Just Culture" -- this is separate, per the General Counsel, from what may be in the works with regard to ODA.
But then Mr. Bradbury continues and notes that FAA is "developing a new policy to ensure appropriate FAA oversight of ODA programs". (p47) In that segment the G.C. invokes specifically the Administrator's statement that delegation is a privilege and not a right, and further notes that the new policy will take account of what Mr. Bradbury calls "any history of undue influence on ODA decision-making." And the policy also will take account of the additional work to be done by the I.G. as well as input from a group called the Expert Review Panel, as established by the reauthorization bill (section 213). As a kind of "watch this space" item the G.C. memo points out that "FAA expects to have the draft policy prepared for public comment in the coming months." Certainly a wealth of aviation safety community people and groups will anticipate offering such comments.
Beyond those steps, the G.C. writes that FAA is establishing an ODA Office to be part of its Aviation Safety Organization and gives some context for what it will do and how it will be initiated.
I don't know what the reauthorization bill actually says about the Expert Review Panel, and "politics" always can intrude on what otherwise would be a very technically virtuous process, but even as I am reading the detailed sections of the I.G. report closely, it sure seems as if some very serious people at FAA are motivated plus devoted to right the ship.
Just another nail in the coffin. The civil litigation is what the Boeing execs must be most worried about. I predict that when the dust settles Boeing will be split into 2 companies, Boeing Defence and Boeing Commercial. The wave of litigation will sink the current Boeing commercial which will be reorganized in bankruptcy.
The “new” Boeing will provide plenty of room for a repackaging of the oversight narrative to make it seem like it’s all better now even though nothing has really changed.....
The “new” Boeing will provide plenty of room for a repackaging of the oversight narrative to make it seem like it’s all better now even though nothing has really changed.....
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"The civil litigation is what the Boeing execs must be most worried about." (Big Pistons Forever)
Having a little insight on Boeing's legal challenges prompts me to say that the senior execs are worried at least as much, if not more, about the criminal investigations which are still open (at last report). They've also got to be quite immersed (to put it nicely) in the on-going efforts to get the airplane back into airworthiness status, customer acceptance and deliveries, and scheduled service (as it slowly returns, hopefully, with progress against pandemic issues). That having been said, the Board of Directors could very likely be emphasizing more of the long-term picture, about financial intactness and possible threats of bankruptcy, as to which your prediction unfortunately could turn out to be correct.
But I think it won't be. I have an NDA to observe scrupulously. So I will say in general terms only that the financial impacts, at the worst-case level, from much of the pending civil litigation is not as open-ended as the misdeeds (again putting things nicely) by Boeing in the certification debacle would suggest exists. For one thing, litigation where much of the factual picture is undisputed can work out a lot like an axiom cocktail waitresses often recite: time is money and money is time. The Boeing defense attorneys are, shall we say, quite adept at stringing things out, a prime example being the motion to transfer cases out of Illinois - a standard aviation liability defense move but also one that slows things down and sometimes significantly.
Result: faced with an alternative of interminable waiting, settlement can be induced at lesser amounts than the catastrophic levels presumably motivating such dire predictions. In this context the I.G. report appears to place large portions of the factual case out of disputed reach, prompting defense counsel to rely even more on running a delay playbook, which does tend to induce settlements.
Whether the corporate role fulfilled by the "current" Boeing is foundational to U.S. national security interests as well as the fundamental soundness of the global civil aviation system is less of a lawyer point; probably a planeload of MBAs with spreadsheet apps all over their devices would be needed to crunch financials. But such a focus on financials is at the root of this debacle, and so predictions of so-called existential peril for the once-proud plane-maker might yet turn out to be all too valid.
As for effectiveness of reform efforts, when senior people from both parties and in both House and Senate on the committees with the primary jurisdiction agree broadly on what will be changed and needs to be changed, then even though I don't think a prediction, as such, should be made . . . it does appear that a discernible sobriety about the matters at hand has intruded upon the Hill. And if there is a view that Administrator Dickson is not "for real", then I don't share it.
Having a little insight on Boeing's legal challenges prompts me to say that the senior execs are worried at least as much, if not more, about the criminal investigations which are still open (at last report). They've also got to be quite immersed (to put it nicely) in the on-going efforts to get the airplane back into airworthiness status, customer acceptance and deliveries, and scheduled service (as it slowly returns, hopefully, with progress against pandemic issues). That having been said, the Board of Directors could very likely be emphasizing more of the long-term picture, about financial intactness and possible threats of bankruptcy, as to which your prediction unfortunately could turn out to be correct.
But I think it won't be. I have an NDA to observe scrupulously. So I will say in general terms only that the financial impacts, at the worst-case level, from much of the pending civil litigation is not as open-ended as the misdeeds (again putting things nicely) by Boeing in the certification debacle would suggest exists. For one thing, litigation where much of the factual picture is undisputed can work out a lot like an axiom cocktail waitresses often recite: time is money and money is time. The Boeing defense attorneys are, shall we say, quite adept at stringing things out, a prime example being the motion to transfer cases out of Illinois - a standard aviation liability defense move but also one that slows things down and sometimes significantly.
Result: faced with an alternative of interminable waiting, settlement can be induced at lesser amounts than the catastrophic levels presumably motivating such dire predictions. In this context the I.G. report appears to place large portions of the factual case out of disputed reach, prompting defense counsel to rely even more on running a delay playbook, which does tend to induce settlements.
Whether the corporate role fulfilled by the "current" Boeing is foundational to U.S. national security interests as well as the fundamental soundness of the global civil aviation system is less of a lawyer point; probably a planeload of MBAs with spreadsheet apps all over their devices would be needed to crunch financials. But such a focus on financials is at the root of this debacle, and so predictions of so-called existential peril for the once-proud plane-maker might yet turn out to be all too valid.
As for effectiveness of reform efforts, when senior people from both parties and in both House and Senate on the committees with the primary jurisdiction agree broadly on what will be changed and needs to be changed, then even though I don't think a prediction, as such, should be made . . . it does appear that a discernible sobriety about the matters at hand has intruded upon the Hill. And if there is a view that Administrator Dickson is not "for real", then I don't share it.
WillowRun
I also think that Mr Dickson is the real deal, but money is the sincerest form of flattery. To achieve lasting, substantive, and effective change in the oversight of the ODA process and more broadly the relationship between Boeing and the FAA means a lot more money has to go to the FAA. That I think is where reality meets desire. I believe that there is a strong desire for change in the Legislative branch, the regulator and at the working level in Boeing. I just don't see the desire for change as strong enough to spend the money to truly fix the oversight process. That is why I think we will end up with lots of smoke and mirrors and "mission accomplished" press briefings, but at the end of the day minimal change.
This is not USA bashing as the exact same dynamic is going on in most other regulators. The COVID-19 pandemic has stressed public finances everywhere and so increasing budgets to federal departments is going to be a tough sell......
I also think that Mr Dickson is the real deal, but money is the sincerest form of flattery. To achieve lasting, substantive, and effective change in the oversight of the ODA process and more broadly the relationship between Boeing and the FAA means a lot more money has to go to the FAA. That I think is where reality meets desire. I believe that there is a strong desire for change in the Legislative branch, the regulator and at the working level in Boeing. I just don't see the desire for change as strong enough to spend the money to truly fix the oversight process. That is why I think we will end up with lots of smoke and mirrors and "mission accomplished" press briefings, but at the end of the day minimal change.
This is not USA bashing as the exact same dynamic is going on in most other regulators. The COVID-19 pandemic has stressed public finances everywhere and so increasing budgets to federal departments is going to be a tough sell......
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There's nothing really to disprove, and maybe not even to mitigate, pessimism about funding levels changing. In more than just a few negotiations with opposing counsel I have had to remind them that Money Talks, and [insert well-worn vulgarity here] Walks (a phrase that I think got its start in auto dealerships).
If I never see or hear the "mission acc____" phrase again for as long as I might live, it still will be too soon.
Maybe the 737 MAX debacle is unfolding as a massive wake-up call; traffic is still projected to grow enormously in the next, let's say 10, 15 years or thereabouts, and unless the certification process Gets Well Soon the market needs of the world are going to be satisfied, but just not by U.S. manufacturing. I won't try to channel the late Wimpy of the Machinists because it can cause ranting.
If I never see or hear the "mission acc____" phrase again for as long as I might live, it still will be too soon.
Maybe the 737 MAX debacle is unfolding as a massive wake-up call; traffic is still projected to grow enormously in the next, let's say 10, 15 years or thereabouts, and unless the certification process Gets Well Soon the market needs of the world are going to be satisfied, but just not by U.S. manufacturing. I won't try to channel the late Wimpy of the Machinists because it can cause ranting.
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Thanks for experiences & balanced views.
What struck me in latest WSJ article, and has also been mentioned above, is that apparently it isn't the FAA that sets the technical qualifications for employees who are named as designees and it is Boeing approving their appointments. And the limits on designees talking directly with FAA inspectors while being delegated by the FAA.
My biggest question is where are the rulemakers that pushed / approved these "streamlining", effiency improvements? In consecutive FAA re-authorizations this was pushed further and further, well into 2017. Everybody was fully aware.
And even the congress GAO was cheering the certification developments all the time. Putting pressure on FAA to make sure EASA wouldn't double check, seen as a waste of time, hurting the industry competitiveness.
GAO summary:
https://www.gao.gov/assets/690/683650.68365M
More detailed (19 pages):
https://www.gao.gov/assets/690/683649.pdf
What struck me in latest WSJ article, and has also been mentioned above, is that apparently it isn't the FAA that sets the technical qualifications for employees who are named as designees and it is Boeing approving their appointments. And the limits on designees talking directly with FAA inspectors while being delegated by the FAA.
My biggest question is where are the rulemakers that pushed / approved these "streamlining", effiency improvements? In consecutive FAA re-authorizations this was pushed further and further, well into 2017. Everybody was fully aware.
And even the congress GAO was cheering the certification developments all the time. Putting pressure on FAA to make sure EASA wouldn't double check, seen as a waste of time, hurting the industry competitiveness.
GAO summary:
https://www.gao.gov/assets/690/683650.68365M
More detailed (19 pages):
https://www.gao.gov/assets/690/683649.pdf
Last edited by keesje; 11th Jul 2020 at 10:38.
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Progress in Improving its Processes . . . indeed
Keesje, that's a great find (and plus, the full 19-page GAO document as well).
First, some context and, to be followed with an observation trying to answer the question about where have all the rulemakers gone?
The GAO report is testimony provided by a Ph.D. with the title (in 2017) of Director, Physical Infrastructure Issues. (If anyone is curious GAO is an agency within the legislative branch of the U.S. federal government - not part of the Executive branch.) The occasion was a hearing before the Senate Committee on Commerce, Science and Transportation, Subcommittee on Aviation Operations, Safety and Security. Although this SLF has not drilled back almost a decade to locate and then to read (and study) the roots of all this - the roots are worth noting. In the 2012 FAA Modernization and Reform Act, the Congress directed FAA to charter "two aviation rulemaking committees--one to improve certification processes and [the second] to address regulatory consistency[.]" For the uninitiated with regard to U.S. legislative methods and terminology the 2012 legislation reauthorized the FAA -- meaning it provided legal authorization for other Congressional enactments to appropriate funds -- for Fiscal Years 2012-2015 (enacted on Feb. 14, 2012, as Public Law 112-095).
Now, in the aftermath of the 737 MAX debacle and as the world airline sector continues to reel from an intersecting aftermath of a global pandemic, in both the House and the Senate, Committee leaders as well as senior staff members are hoping to re-corral the horse, and not just undo the harms evidently done to the certification process but also reset it so as to better prepare for the near-term future and somewhat further as well. But, are they delving back into those two 2012 Reauthorization legislation reports? -- and to examine the potential biases or other limitations of the individuals who served on those two "rulemaking" committees? -- and to cut into how FAA addressed the output of those committees (other than re-reading the 2017 GAO report?) -- and perhaps most rhetorically, requesting the input of the CAAs from other principal aviation sector countries to gain their perspective? Would it be unprofessional to say I have my doubts? -- Congress most typically is not where one looks for the most rigorous expertise and respect for authoritative input (as opposed to smoothest lobbyists).
GAO reports can be very interesting (thanks again for posting it keesje) and often stand as reminders, in the U.S. Congress there is no such thing as an equivalent to "the pointy end of the airplane."
Bonus swipe at Congressional relevance: one would have thought from all the many acronym-like named groups part of CAPSCA, the ICAO-affiliated conglomerate group which was supposed to deal with preventing a global pandemic, that such a thing as is actually happening worldwide could not happen. Is Congress going to examine that part of the crisis threatening to wreck the world airline sector? (CAPSCA is: . . . ..Collaborative Arrangement for the Prevention and Management of Public Health Events in Civil Aviation. Perhaps there is a hidden nose-dive feature in this "Arrangement" which also happens not to be in either an FCOM or training, and there certainly was no simulation for stopping the first outbreak before it could grow into a pandemic.)
First, some context and, to be followed with an observation trying to answer the question about where have all the rulemakers gone?
The GAO report is testimony provided by a Ph.D. with the title (in 2017) of Director, Physical Infrastructure Issues. (If anyone is curious GAO is an agency within the legislative branch of the U.S. federal government - not part of the Executive branch.) The occasion was a hearing before the Senate Committee on Commerce, Science and Transportation, Subcommittee on Aviation Operations, Safety and Security. Although this SLF has not drilled back almost a decade to locate and then to read (and study) the roots of all this - the roots are worth noting. In the 2012 FAA Modernization and Reform Act, the Congress directed FAA to charter "two aviation rulemaking committees--one to improve certification processes and [the second] to address regulatory consistency[.]" For the uninitiated with regard to U.S. legislative methods and terminology the 2012 legislation reauthorized the FAA -- meaning it provided legal authorization for other Congressional enactments to appropriate funds -- for Fiscal Years 2012-2015 (enacted on Feb. 14, 2012, as Public Law 112-095).
Now, in the aftermath of the 737 MAX debacle and as the world airline sector continues to reel from an intersecting aftermath of a global pandemic, in both the House and the Senate, Committee leaders as well as senior staff members are hoping to re-corral the horse, and not just undo the harms evidently done to the certification process but also reset it so as to better prepare for the near-term future and somewhat further as well. But, are they delving back into those two 2012 Reauthorization legislation reports? -- and to examine the potential biases or other limitations of the individuals who served on those two "rulemaking" committees? -- and to cut into how FAA addressed the output of those committees (other than re-reading the 2017 GAO report?) -- and perhaps most rhetorically, requesting the input of the CAAs from other principal aviation sector countries to gain their perspective? Would it be unprofessional to say I have my doubts? -- Congress most typically is not where one looks for the most rigorous expertise and respect for authoritative input (as opposed to smoothest lobbyists).
GAO reports can be very interesting (thanks again for posting it keesje) and often stand as reminders, in the U.S. Congress there is no such thing as an equivalent to "the pointy end of the airplane."
Bonus swipe at Congressional relevance: one would have thought from all the many acronym-like named groups part of CAPSCA, the ICAO-affiliated conglomerate group which was supposed to deal with preventing a global pandemic, that such a thing as is actually happening worldwide could not happen. Is Congress going to examine that part of the crisis threatening to wreck the world airline sector? (CAPSCA is: . . . ..Collaborative Arrangement for the Prevention and Management of Public Health Events in Civil Aviation. Perhaps there is a hidden nose-dive feature in this "Arrangement" which also happens not to be in either an FCOM or training, and there certainly was no simulation for stopping the first outbreak before it could grow into a pandemic.)
