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Will the Deaths of Americans on MH17 Finally End $1B U.S. Relationship with Russian Arms Giant?

The Russian arms giant that has been the target of so much consternation in Congress since President Obama lifted its sanctions in 2010 recently marketed to Malaysia the same missile system believed to have taken down a Malaysia Airlines flight over Ukraine today.

Lawmakers have been trying to block U.S. funds from lining the pockets of Rosoboronexport — Russia’s state-owned arms behemoth that has raked in more than $1 billion in Defense Department contracts since 2011. President George W. Bush had placed a ban on doing business with the firm in 2008.

At the mid-April Defence Services Asia Conference and Exhibition in Kuala Lumpur, Rosoboronexport pitched to government officials the same surface-to-air system, the Russian-made Buk, suspected to have been fired at Malaysia Airlines Flight MH17 headed from Amsterdam to Kuala Lumpur.

“Our military technical cooperation with Malaysia has been developing rather dynamically on the mutually beneficial basis. It is fostered by successful operation of Russian-made equipment supplied earlier and our measures to improve after-sale services,” said Nikolai Dimidyuk, Rosoboronexport’s special project director and head of the delegation at the exhibition, in a statement at the time. “Good prospects are open for Russian air systems such as multi-role fighters and military transport helicopters in particular, air defense equipment, close combat weapons as well as littoral control systems and patrol vessels.”

“Rosoboronexport specialists believe that the Malaysian side will be very much interested in the Buk-M2E medium-range air defence missile system,” the arms exporter declared.

On board the doomed flight, which came down in eastern Ukraine, were 280 passengers and 15 crew members. Officials in the Netherlands confirmed that the victims include 154 Dutch, 27 Australians, 23 Malaysians, 11 Indonesians, six Brits, four Germans, three Belgians, one Filipino and one Canadian.

U.S. officials would not confirm reports, echoed by Sen. John McCain (R-Ariz.), that 23 Americans were on board.

Ukrainian intelligence released a transcript of a conversation reportedly intercepted between Russian military intelligence officers and separatists in which Igor Bezler, a Russian military intelligence officer according to Ukraine’s security service and leading commander of the self-proclaimed Donetsk People’s Republic, calls Vasili Geranin, identified as a colonel in Russian armed forces intelligence.

“We have just shot down a plane. Group Minera. It fell down beyond Yenakievo (Donetsk Oblast),” said Bezler in the conversation that took place 20 minutes after MH17 came down, according to the Ukrainians.

“Pilots. Where are the pilots?” Geranin asked.

“Gone to search for and photograph the plane,” Bezler replied. “It’s smoking.”

In another conversation 40 minutes later, two separatists discuss the crash and confirm “in short, it was 100 percent a passenger aircraft.” In a subsequent transcript, Cossack commander Nikolay Kozitsin tells an unidentified militant that the Malaysia Airlines plane must have been “carrying spies.”

“They shouldn’t be f–cking flying,” Kozitsin said. “There is a war going on.”

As the drama was unfolding in Ukraine, Afghanistan commander Gen. Joseph Dunford was telling senators in his nomination hearing to become the next commandant of the Marine Corps that the relationship with Russia’s arms giant is a necessary one.

In fact, Dunford said congressional effort to block the U.S. from doing business with Rosoboronexport could be “catastrophic” for forces in Afghanistan.

The Pentagon is expecting the last of the 88 Mi-17 helicopters purchased for Afghanistan’s air force to be delivered by this fall, a purchase made on the assessment that the Afghans would be better able to operate and maintain the Russian technology.

“Without the operational reach of the Mi-17, the Afghan forces will not be successful in providing security and stability in Afghanistan and will not be an effective counterterrorism partner,” Dunford told Sen. Carl Levin (D-Mich.). “And one of the second order effects of that, chairman, which is why I use the word ‘catastrophic,’ is that we’ll also have an adverse impact on our force protection in 2015.”

“Among the assumptions that I make in 2015, is the Afghan Security Forces will contribute to the force protection of coalition forces in 2015. And their ability to do that would be significantly degraded without the Mi-17.”

Dunford argued that even though the latest batch of Mi-17s is bought and paid for, the Pentagon needs to keep dealing with the Russians to secure spare parts for maintenance.

Rosoboronexport has avoided sanctions under the punitive measures undertaken by the White House since Russia’s invasion of Crimea in February.

But the latest congressional action to cut off taxpayer funds flowing to the Russian giant is an amendment in this year’s defense reauthorization bill.

Since the arms giant supplied Assad with more than $1 billion in deliveries in 2011 alone, Congress leaned on the White House to trim the lucrative no-bid contract with Rosoboronexport to supply the Afghan military with the Mi-17s.

President Obama last year skirted around an amendment passed unanimously by the Senate to prohibit the use of taxpayer dollars to enter into agreements with Rosoboronexport, using a national security loophole to claim that dealing with the Russian firm was in America’s critical interest. As the death toll from Russian arms rose in Syria and protests from both sides of the aisle grew louder, the Pentagon agreed in November to cut its contact with the exporter short and canceled a $345 million order for 15 additional helicopters in Fiscal Year 2014.

Sens. John Cornyn (R-Texas), Dan Coats (R-Ind.), Richard Blumenthal (D-Conn.), Chris Murphy (D-Conn.), John Boozman (R-Ark.), Jim Risch (R-Idaho), David Vitter (R-La.), Roger Wicker (R-Miss.), Kelly Ayotte (R-N.H.) and Mark Kirk (R-Ill.) argued in a March letter to Obama that until the invasion of Ukraine, their key concern had been Assad “using these very weapons” obtained from Rosoboronexport “to murder innocent Syrian civilians, as confirmed by DoD.”

“We remain deeply troubled that DoD is sending huge cash payments to an agency that continues to enable mass murder,” they added.

“However, Russia’s recent actions in Ukraine give us a broader reason to put an end to DoD’s misguided business dealings with Rosoboronexport and sanction this agency. Rosoboronexport is an arm of the Russian government and a powerful instrument of Vladimir Putin’s increasingly belligerent foreign policy, and it handles more than 80% of Russia’s weapons exports. By obstructing the business of Rosoboronexport and limiting the income it provides to corrupt Russian officials, we would increase the costs of Putin’s aggression.”

The senators noted that the administration flirted with danger in “relying too heavily” on the Russian firm to build up the Afghan military, “and DoD’s blindness to these risks has been deeply troubling.”

“Indeed, DoD’s procurement of 63 Mi-17 helicopters from Rosoboronexport has created strategic vulnerabilities that could have serious implications for our own national security, should the Afghan military not reach its intended capacity,” they noted.

“On August 5, 2013, a number of us raised these issues regarding overreliance on Russia in a letter to DoD. We specifically asked: ’Does the overreliance on Russia fostered by this Mi-17 program put the U.S. at risk of Russian coercion or blackmail on other security issues, such as the crisis in Syria, Iran’s drive to obtain nuclear weapons, U.S. missile defense, arms control negotiations, or the security of former Soviet republics?’ In a reply letter from the Chairman of the Joint Chiefs, these and other concerns were ignored. In addition, DoD recently indicated that it has contemplated further business dealings with Rosoboronexport in the areas of Mi-17 sustainment and machine-gun procurement. We ask you to end any such plans.”

The senators stressed that the Pentagon’s “failure to consider the strategic implications of sourcing mission-critical military equipment from a hostile power such as Russia is surprising.”

Tweeted Murphy today: “If this plane went down as a consequence of the #Ukraine conflict, then Russia has blood on its hands no matter who fired.”