Wednesday, November 13, 2013
Today is a big one for Washington state’s economy.
The Boeing machinists union is voting on whether to accept or reject the company’s offer. If the offer is rejected when the votes are counted tonight, Boeing executives contend the company will move assembly of its new 777X jetliner from Everett to South Carolina with a nonunion work force.
Boeing isn’t bluffing.
But Boeing workers — and the economy of the entire state — will take a big hit if the contract is not approved.
The deepest problems will occur in Everett and the surrounding area, but the ripples will travel east over the Cascades. For example, Boeing has a manufacturing plant in Spokane. The impact will touch most of the state’s 39 counties in some way.
As of this morning, the union members and its leadership still seemed divided. The vote could go either way.
The contract offer isn’t a gain, as the workers will be losing ground with retirement and health benefits. It’s understandable they would want to reject the proposal and continue to negotiate.
Boeing isn’t going to negotiate. It wins whether the contract is accepted or rejected.
On Saturday the Legislature approved $8.7 billion in tax breaks to persuade Boeing to build the 777X in Washington state. The tax-incentives measure, signed into law by Gov. Jay Inslee on Monday, extends commercial-airplane tax breaks until 2040 and expands a sales-and-use tax exemption for construction of buildings used to manufacture airplanes as long as the 777X is one of those planes.
So if the 35,000 member union accepts this offer the company saves on taxes and doesn’t raise its labor costs.
But a no vote sends the assembly to South Carolina where Boeing already has an assembly plant for its 787 Dreamliner. That plant, as well as Boeing’s corporate offices in Chicago, are proof Boeing isn’t afraid to move outside of Washington if it’s good for profits.
Boeing no longer (if it ever did) has warm and fuzzy attachments to Washington state. Its corporate culture is just as ruthless as any supersized company in America.
The machinists will be helping themselves, other Boeing employees and the entire state by accepting the contract today. They don’t have to like it, but the economic realities of 2013 make approving the contract necessary.