Following the presentation of the Business Case for Consolidating Line 2 in Everett by the governor to Boeing, a few Republicans, a business association and a few others focused on the fact that Washington isn’t offering new incentives. We discussed why in this posting. The critics of the report also noted that Boeing continues to complain that Washington’s unemployment insurance rates are too high, and a Boeing spokesman also referred to this view when commenting on the report.
South Carolina’s UI rates are lower, these people said. Well, maybe this is why. This four minute news report points out–as did Washington’s study–that SC has a $2 billion hole in its unemployment insurance fund for which taxes are going to have to be raised. SC also has an unemployment rate of more than 11%. If critics are going to talk about Washington’s unemployment tax rate and compare it SC’s, they need to talk about the whole picture. Washington’s UI rate has come down 42% in recent years and the UI fund is solvent. SC’s UI fund is insolvent and it’s going to have to raise these rates to make it solvent. This is the whole story.
Washington’s governor noted that our Legislature is not in session and that Boeing told her the issue over where to put Line 2 is not about tax rates or concessions, it’s about production stability and labor strikes. When the Legislature reconvenes in January, the “business climate” issues will likely be back on the table. In the meantime, locating Line 2 is between Boeing management and union leadership. No amount of political grandstanding will change this fact.
Things are finally getting whittled down to the naked truth. None of this was ever about Washington. It’s all about Boeing VS the IAM. Always has been at it’s core. Boeing tried another taxpayer cash grab and had it’s hand politely slapped away, but that is just a peripheral event to the main feature.
Quite frankly, even as a shareholder, I have a great deal of trouble distinguishing who is at fault there. Probably both.
And i’m not sure at all BA’s sort of pressure tactics will get it anything good, just more strife. The IAM just seems to harden under pressure.
Maybe it’s time for a softer, more diplomatic approach. Let everyone save a little face.
Who am I kidding. This is Boeing and scorched earth and fields sown with salt are all this outfit knows. Humilility just isn’t in it’s corperate character. Neither is pragmatism.
The union for it’s part, is a one trick pony. A reactive one. But then again, it can be no other way. That’s how it is constructed. While Boeing can be nimble in it’s decision making, with just a few execs and ultimatly the CEO calling the shots, a union cannot be so with thousands of votes to be cast before any deal can be struck. The union cannot via it’s rules and the labor laws, make any sort of meaningful first move or proposal. Boeing must be first to speak up and to do that would would show humility, and they have none to draw on.
South Carolina Unemployment Trends – August 2009
South Carolina Unemployment Trends in Heat Map form:
here is a map of South Carolina Unemployment in August 2009 (BLS data)
versus South Carolina Unemployment Levels 1 year ago