Monday, May 16, 2011

Unions vs. Reality, Boeing Edition

Boeing was recently issued a complaint by the National Labor Relations Board (“NLRB”) that alleges Boeing unlawfully transferred jobs to a non-union facility.


The NLRB is a “quasi-judicial” federal agency whose board members are appointed by the President. At present, the four acting board members, and one yet-to-be-confirmed board member have all been appointed by President Obama.

Despite the sputtering economy, Boeing has managed to secure orders from airlines around the world for hundreds of their new 787 Dreamliner aircraft. Great news for Boeing, but they have a problem. Its current 787 plant in Washington can only produce 7 of the 10 planes it needs to deliver every month to fill its outstanding orders on schedule. As a result, Boeing determined it needed to build a new plant (and create thousands of new jobs) to manufacture the 3 additional planes per month needed to fulfill the orders.

When Boeing decided to build that new plant in South Carolina instead of its home state of Washington, the International Association of Machinists and Aerospace Workers union threw a temper tantrum and whined to its friends at the NLRB. South Carolina happens to be a right-to-work state, and apparently unions don’t like the idea of expanding businesses into right-to-work states. That’s right, expanding, not moving. The union employees in Washington will be unaffected – not a single job will be moved from Washington to South Carolina, yet this is still somehow unacceptable to the unaffected union.

Right-to-work means that employees cannot be FORCED to join a union; it doesn’t mean there can’t be a union. Interestingly enough, when employees aren’t forced to join the union, they usually don’t. The wholly-Obama-appointed NLRB knows exactly where their bread is buttered and quickly formalized the union temper tantrum with an official complaint alleging that Boeing’s business decision to set up shop in South Carolina was unlawful and the new plant must be built in Washington. All this, AFTER Boeing built the facility in South Carolina.

It doesn’t take an aeronautical scientist to see why Boeing would choose South Carolina as the site of its new plant. While the weather in South Carolina is infinitely better than Washington and the southern drawls that will be heard throughout the factory will be charming, Boeing ultimately believes it can produce the same quality product more efficiently, and cheaper, than it could in Washington. Basic Business For Dummies tells us that the primary advantage of a South Carolina plant is that its employees cannot be forced to join a union, thereby eliminating the prohibitively expensive and restrictive union employment and benefit contracts, and perhaps more importantly, eliminating the constant threat of crippling union strikes (averaging one every three years in Washington) that would derail the already tight delivery deadlines, and ruin their relationships with the airlines.

Anyone with even the slightest hint of business acumen would advise Boeing to locate the plant in South Carolina, yet a governmental agency is trying to strong arm, or potentially even force, one of America’s largest manufacturers into a sub-optimal business decision to appease a special interest group.

Do we really believe this is something that should be allowed to happen in the United States? Maybe Greece, but the United States?

With all due respect to Matt Taibbi at Rolling Stone, the” great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money” could just as easily refer to the union bosses and their politician puppets, not just Goldman Sachs. I’m happy to be challenged on this, but can anyone name a heavily unionized industry that the unions haven’t parasitized into bankruptcy and/or models of inefficiency and ineptitude? Autos, airlines, US Postal Service, Public Education, Healthcare, Utilities, Public Transportation…I could go on and on.

How can we allow four bureaucrats in Washington DC to exert this level of influence over a private company making the most basic of business decisions?

We can’t.

I’m glad Boeing, Congress and Governor Haley of South Carolina are all standing up to the unions, the NLRB and President Obama. Our businesses, not to mention our unemployed, can’t afford to be strong-armed into non-competitive cost structures by unions and their bought-and-paid-for friends in Congress and the White House. Anti-capitalist policies like this are a sure fire way to promote off-shoring of manufacturing facilities by American companies, while at the same time scaring away foreign companies looking to invest in the US.

Way to go NLRB.


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