Washington is falling behind other states when it comes to competing for aerospace business, a new study finds.
The study, conducted by Deloitte Consulting and obtained by local analyst Scott Hamilton with Leeham Co., was funded by the state of Washington.
David Groves of the Washington State Labor Council responds in an email sent out today:
As for the Deloitte “report” itself, in my cursory initial review, I already see that it uses the identical legislative talking points used by Boeing and business lobbying groups to try to lower their taxes (although I missed any mention of WA’s $3.2 billion tax break they already got). On Page 20, Deloitte’s report recommends that Washington “align workers’ compensation benefit levels (and thus cost to employers) with competing states.” The important thing to note here is the specific reference to benefits, as opposed to actual employer costs. There is a reason they — and business lobbyists in Olympia — write it this way.
The truth is that the latest objective state-by-state comparison of workers’ compensation systems — the only one of its kind that we know of — conducted by the Oregon Department of Consumer and Business Services, recently ranked Washington 38th in terms of costs (that’s 14th lowest, including D.C.) Yes, the benefits are comparatively higher, but our state-run system is considered a national model for its low-cost, high-benefit efficiency. Many of those “low labor cost” Southern states we compete with have privatized workers’ comp systems, which introduces profit into the equation and raises costs. The Oregon study found that our aerospace competitors in South Carolina (13th highest costs), Texas (17th) and North Carolina (22nd) all have MORE EXPENSIVE workers’ comp systems than Washington’s. So now Deloitte is recommending that Washington cut benefits to injured workers to make us more “competitive” and drop employer costs even more?
Meanwhile Joe Turner dubs a new subcabinet position the state “Department of Boeing.” Hey. The governor practically tripped rushing to the podium to mollify Boeing. You know, it’s fine that Boeing is at the table, and given due consideration, but the tractability by the governor is rather startling. We thought we were supporting a Democrat, when we were in fact supporting a Dreamliner of a politician.
[youtube]http://www.youtube.com/watch?v=JN99jshaQbY[/youtube]
It’s pretty clear that, taken as a whole, the Democratic Party is a captive of corporate interests, which to anyone who has been paying attention the last twenty years is no surprise. The Legislators in power are products of the Clinton era and honed their survival skills on triangulation and seeking the approval of traditional media. The corporate lobbyists threaten to take away jobs, the traditional media issues harrumphs, and most of the Democrats fall in line. Rinse, repeat.
What’s amazing is the sheer tone deaf attitude leadership has for relatively modest requests regarding workplace, environmental and consumer initiatives. If we’re going to continue to worship at the neo-liberal altar, sanding a few rough edges off doesn’t seem unreasonable, unless you’re the Washington Legislature. Anything that might upset editorial boards or business groups is to be hamstrung, delayed, obfuscated and finally discarded.
They play a bunch of games in Olympia, changing the faces and who takes the blame, but if you were hoping for workplace privacy, clean power, continued voter-approved teacher pay or homeowner warranties, you can suck eggs. Our local school districts are going to be savaged, and the Big Three are expecting we will once again fall in line and beg voters to vote for regressive taxes to save K-12 and/or the sick.
This game has been going on for a while. Every year progressive legislation gets sabotaged and we get a bunch of promises and lip service. At some point the excuses no longer bear up under scrutiny.
Fine. It’s not that long until 2010, and it’s even shorter until this November. Let’s see that tax increase on the ballot and let’s see the plaintive cries about saving the wee kiddies from the horrors of overcrowded classrooms. Maybe we could have fought that fight together.
Honestly, now, I’m not so sure.
As for the Deloitte “report” itself, in my cursory initial review, I already see that it uses the identical legislative talking points used by Boeing and business lobbying groups to try to lower their taxes (although I missed any mention of WA’s $3.2 billion tax break they already got).
——————
“So, how do the 2003 tax breaks measure up to what was expected?
“The incentives were projected to slash the state aerospace industry’s taxes over two decades by $3.2 billion. That estimate by the state Department of Revenue has been repeatedly cited over the past four years — it’s even become a cornerstone of Airbus’ complaints to the World Trade Organization about subsidies to Boeing.
“But based on the tax breaks claimed so far, that figure appears significantly overstated. The total could be between $500 million and $900 million smaller.
“On the other side of the ledger, the job impact of the Dreamliner has not matched its marketing success as the fastest-selling jet in Boeing history.
“In 2003, state officials forecast that the 787 would add 3,600 supplier jobs at existing Boeing subcontractors and at new suppliers drawn to Washington.
“But four years later, new suppliers have established just four modest new Dreamliner manufacturing operations employing around 200 people in Washington, half of those jobs in unskilled assembly or distribution work.”
From: Huge tax breaks for aerospace didn’t deliver many new jobs
http://seattletimes.nwsource.c.....obs17.html
The reason Washington State looks so good re: Workers COmp. is that they are illegally holding 3-4 billion of worker and employer money using the investment income to subsidize rates to the tune of $250 million per year.
It’s a complete farce. They did it be over-reserving claims. With L&I’s own data, it was proven they over-reserved claims 9 out of 9 years.
You could have low rates too if you were staked to investment income on $3-4 billion of other people’s money.
Wonder why Boeing doesn’t ask the state to stop BIAW’s spending of millions of dollars a year of L&I monies for political propaganda? There’s a big hunk of waste the Legislature could eliminate right now!
WHAT a surprise that Boeing would use a severe economic downturn to hold Washington hostage again for more tax breaks.
Jerks. Move to the south, morons.
Lauramae–
You may very well get your wish.
That would mean a massive housing sell-off, including many of Boeings suppliers.
Can you tell me the $$ amount of the ripple effect of Boeing leaving Lauramae??
Or is this just another of your knee-jerk, no thought rants??
What wrong with supporting jobs in aerospace? They tend to be pretty good jobs.
Thor–
The PINHEADED KLOWNS like Lauramae, Jon & Goldy HATE Corporate America so much, they wish them the worst and beg them to leave?
Jobs??
The KLOWNS support Government Jobs.
Actually, these addle-brained KLOWNS allow their Hate-driven ideology to preclude any common sense or ability to assess the consequences of their actions.
Knee-jerkers!!
Besides, Gregoire has a lot of other things to worry about like this:
http://www.effwa.org/files/pdf.....-25-09.pdf
A $48.7 MILLION DEFICIT, that’s right..a DEFICIT in this Bienniums Budget.
So the financial walls are collapsing on Gregoire…and her Northwest Division of Moonbat Lunatics are screaming for Boeing to get screwed.
It is a full-fledged CLUSTERF*CK on the Left!!
Lauramae–
Your comment will make for some very excellent campaign material.
Nice…that ought to get Boeing Workers to vote Democrat!
Over 3 billion in tax breaks? That would just about cover the ‘deficit’.
The Bush tax breaks for the rich are equivalent to our national shortfalls as well.
Goldie made reference to a zero sum game the other day. A zero sum game is one in which there are only a fixed number of game pieces in play at any one time. Conservatives deny that the economy is a zero sum game.
Hence, the insistence that tax cuts for the rich increases the size of the pie. Without that article of economic faith, the emperor most obviously is wearing no clothes.
Paul Krugman and William Grieder are the sources for these concepts (for me, at least). Milton Friedman appearances on the Johnny arson show are the conservatives source of ‘new ideas’.
re 8: Much of the goods produced by Boeing comes from our tax money. Increasing taxes increases their source of income.
Think about it. Well, instead of thinking I’ll put workable ideas in the mouth of some authority figure that you trust — like Newt Gingrich.
See, when you have an economy based on a tax funded defense industry, well, you have to pay taxes to feed it.
Mr. Cynical is against the free market of tax funded defense contractors.
Fuck Boeing. Lets build infrastructure — with tax money.
Meanwhile . . . the Democratic leadership in Olympia is falling over itself with one creative proposal after another – an income tax, massive tuition hikes, regressive sales tax hikes – that are enough to make us think Gregoire’s solemn “no tax/no fee” pledges were just a dream. Ah, those were the days, only a short five months ago . . .
Lawmakers likely to ask voters for sales-tax increase
“House Speaker Frank Chopp on Thursday said there’s better than a “50-50″ chance lawmakers will ask voters to increase the sales tax to help backfill proposed cuts to state health programs.”
http://seattletimes.nwsource.c.....es10m.html
Just because Boeing has a fit and moves doesn’t mean that they are going to get those Federal defense dollars.
elsewhere. Didn’t you listen to Rbt. Gates the other day?
Anyone who has read any history knows that businesses have a life cycle. Keeping Boeing alive when it is clear that it is in the early stages of a fatal cancer will only prolong the pain.
They should go now. And we should raise their taxes and milk them for evrything they’ve got while they are n the process of moving.
Cynical is scouring the internet as we speak for more fear propaganda about taxing.
Yeah! And I want my taxes cut TOO! And I want you to get TOUGHER on crime, hire MORE cops, build MORE jails, cut my taxes again, fix my pot holes, rebuild the viaduct, cut my taxes…and I want a pony too!
@5 Oh please. How many Boeing jobs are left for this state to lose? They’ve sent everything to China. Boeing is quickly running out of bargaining chips.
@16 Let’s double the taxes on commercial property owned by out-of-state landlords. Every other state screws nonresidents, so we should get in on that juice, too.
@17 Cynical will settle for a goat, as long as it’s fresh.
#20 is a veiled insult. I mention this in case our stupid trolls don’t get it. I’m sure Cynical knows what I’m talking about. His goats know, too.
@18 Oh please. How many Boeing jobs are left for this state to lose?
——-
http://blog.seattlepi.com/aero.....blog_last3
KKKKlynikal posting about “ideological hate” is a riot. Phuck you, Pharisaical UnChristian Loon.
So Boeing has about 80,000 direct jobs left in Washington…and probably 150,000-200,000 jobs of other suppliers and those who benefit from revenue related to Boeing.
No problem says the KLOWNS!
Raise taxes!!
We must feed the beast.
Your naivety is so ridiculous I don’t know whether to laugh or cry. And this isn’t just about Boeing..don’t you think other businesses are watching closely??
You KLOWNS and your zero-sum economics are so far out of it….but you won’t learn based on basic economics…you will learn by putting your grubby paws on the fire.
Hey Rog…are you saying Boeing should leave??
re 24: Boeing is the beast. We need to raise taxes so they can get more defense contracts.
re 24: ‘naivety’??? I can tell by your spelling that you mispronounce it, as well as misspell it.
How naive is that?
re 24: Sure they should leave. We could then be one of their subcontractors.
In this tax war with Boeing, either one party is going to get hurt (us) by caving to all their demands. Or, both parties will get hurt: us and them. Call their bluff.
They won’t leave.
Cynical’s lunacy is fast approaching JCH level.
Who but the military will buy planes if no one can afford tickets?
Who will pay the taxes for defense spending if there is no middle class?
You are such a chicken-little, cynical. You have the psychology of a Medeival Oaf supplicating the Lord of the Manor for a scrap of bread and some chicken-butt soup.
Boeing is highly unlikely to pick up and move any existing aircraft production elsewhere. The expense and disruption would kill the model in question if not the entire commercial aircraft division. The 737, 747, 767, 777, and 787 will have at least final assembly here until those models are discontinued.
The real question is where will the second line of the 787 (if there is one) and the follow-on to the 737 and 747/777 be built.
Oh and it is a fairly safe bet future Boeing aircraft will have a bit less outsourcing than the 787 did. They got a bit burned with the 787 program.
The big question is if the wings for future Boeing aircraft will continue to be built in Japan like the 787 wings.
Obviously we must institute a state income tax so we can afford to subsidize the Boeing company even further.
Easy answer.
The same people that are paying today, the rich.
As you can see, in 2006 the top 5% paid 60% of the federal tax burden.
How unfair, shouldn’t everyone have to pay taxes. Wouldn’t that be fair. You are in favor of things being fair aren’t you?
Last Thursday, Boeing stock closed at 39.15, up 2,28, a significant rise given the market conditions.
Upon the close of the market, Scott Carson makes his 777 rate reduction announcement, and brings further bad news of charges against earnings for Q-1, due to heretofore unknown airplane pricing schemes giving customers deep discounts on soon to be delivered aircraft.
This cause Boeing stock to drop 1.35 in limited after hours trading.The markets were closed on friday due to good friday market holiday.
There is little doubt Boeing stock will take a severe beating on monday. Boeing, combined with GE (engine provider for 777) another DOW component, may well drag the entire DOW, perhaps even the entire market down. Standard and Poors promply put Boeing’s credit rating under watch for potential downgrade
So what does Boeing do?
Implements an ad hoc rule preventing employees from selling Boeing stock, or anyone else’s at the thursday closing price, OR the opening price monday.
Transactions from employee 401K plans will only be accepted at the prices established at the close of the market on monday.
Ot would seem that Boeing wants it’s employees to sit back and potentially suffer huge losses from their retirment accounts, for no reason other than PURE SPITE.
Boeing executives continue to enrich themselves via stock bonuses and options, which they dump the same day they are awarded:
http://finance.yahoo.com/q/it?s=BA
Such insider activity indicates that they have no confidence in the company, or even their own words and actions. They simply convert the stock immediatly to cash and run away from Boeing as fast as possible.
There has not been a single open market purchase of Boing stock by any Boeing executive or member of the board, save ONE instance, in fifteen or more months.
And there will always be, in my mind, the extraordiary clairvoyance of Boeing’s CEO, James McNerney, who made a particularly timely sale of 8,588 shares on 2-Jan-09 at $45.25 per share, for a cool $388,607.
This coming after some very suspect activity in the options market concerning Boeing stock futures, that very temporarily cause a pop in the price of Boeing common stock.
Yet Boeing’s management demands, no FORCES it’s employees to take losses on the Boeing stock they own via their 401K VIP accounts.