Thursday, May 27, 2010
The Boeing Company has been the most important single industry in Western Washington for decades. Yet, there is a dearth of true leadership among our state and federal officials to protect this glorious gift to our economy. The current strike by the International Association of Machinists reiterates the lack of intellectual depth on this issue. Although as a Republican I am inclined to support the Company’s position during the strike my main concern is that no one has talked about what truly ails Boeing. Boeing is hobbled by its labor strife. Boeing is hobbled by an arrogance which treats its customers to several year long delays before delivery of ordered goods. Between management and the Boeing unions someone should point out a better way. That better way is to allow Boeing management the flexibility to pay its employees what the free market determines is the correct wage. I believe if that were to happen Boeing would have twice the economic footprint in this area as it does now. Boeing would by necessity to meet its orders pay its worker well and the economy and this area would thrive. Boeing has a 900 plane backlog of orders. This type of backlog is just asking for other companies or nations to get into the aircraft manufacturing game. Boeing’s customers are being taken for granted by management and employees as well as the political leadership in this state. This attitude is suicide for the aircraft industry in this state. The Union officials who promote labor strife do so to protect their power and Boeing and its employees are the ones who suffer because neither Boeing nor its workers are being allowed to become what they should become; the preeminent aircraft and transportation manufacturer in the world with a scale at least twice its current size. If not for the anti-capitalism political climate in this state most of this growth could occur in Washington. With strong political leadership it will. A anti-management mantra will backfire. A stronger, more competitive Boeing will result in far greater profitability to Boeing and a secure and prosperous future for its skilled workforce. Boeing management will, because of the necessity of competing with other aircraft manufacturers, outsource as many jobs as they must to stay competitive. That is the way the world works. Otherwise, Boeing will perish like thousands of other industrial companies which have perished for lack of competitiveness. Moreover, the actions of the IAM and the Democrat political leadership in this state have driven Boeing to move its headquarters to Chicago. Boeing will not stop there if they must move to survive. The decision to move headquarters was a direct result of the last strike and the lap dog fawning over organized labor that passes for political leadership in this state. The IAM can only protect those who are most senior on their membership roles but even this protection is illusory because if Boeing is noncompetitive or cannot perform as its customers demand then Boeing will suffer from increasingly fierce competition which will destroy the security the IAM so wants. If Boeing is not competitive it will shrink which will destroy the home equity of so many Boeing workers. That process is happening in Detroit and its union auto workers now. It is undoubtedly true that Boeing workers are highly skilled and deserve a wage commensurate to that skill. In order to attract and retain workers the quality of those at Boeing an attractive wage must be paid. These are not average people. But that attractive wage will be paid only as long as Boeing is profitable and competitive. The more profit Boeing makes the more the price of skilled labor gets bid up. I am not kidding when I say Boeing should be twice as big as it is now. Boeing cannot meet its commitments now with the Company being at too small a scale. How can they build the Air Force tanker without a larger scale of production? A 900 plane backlog is ridiculous. It invites competition. It shows an arrogance and weakness that could be fatal to Boeing. Likewise, the IAM is arrogant and enfeebling to the Company. It is this same kind of Hubris which has nearly destroyed Detroit and the American automobile industry.
Posted by Doug Cloud at 2:26 PM