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Boeing Cashes in on Corporate Welfare

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On June 11, the Washington State Legislature offered Boeing a $3.2 billion tax cut to entice the aerospace giant to build its new 7E7 jet in the state. For months, the company has been playing Washington and 21 other states off one another in a race-to-the-bottom effort to secure the largest corporate handout.

Through arm-twisting and blackmail, Boeing secured the biggest tax write-off in state history. One union leader, interviewed after the Legislature rammed the deal through, referred to it as “the day corporate greed won.”

Shortly after this deal was struck, under the guise of creating more jobs, the company turned around and announced plans to lay off more workers and export hundreds of jobs to countries with cheaper, non-union labor.

The tax breaks are to be paid for by reducing unemployment benefits, hammering the state’s laid-off workers at a time when Washington has the second highest unemployment rate in the nation. Additionally, cuts will be made to injured workers’ compensation benefits, particularly workers with hearing loss, where Boeing is a huge culprit because of its loud factories. (Seattle Post-Intelligencer, 6/12/03)

Hypocritically, a few months before, Democratic Governor Gary Locke delayed the implementation of two voter-approved initiatives to increase teacher salaries and reduce class sizes. Despite one of the initiatives passing with the highest majority of any ballot measure in state history (73%), Locke claimed: “We just don’t have the funding for this.”

However, when Boeing lobbyists came to Locke’s door looking for a tax break, he had no problem squeezing more money out of the state’s already battered workers. Once again, state Democrats – who control both the legislature and the governorship – sold out working class people in the name of big business profits.

Boeing has also received massive handouts from the federal government for the purchase of military aircraft. In May, the Pentagon approved a deal to lease 100 Boeing planes for $16 billion. As if buying the aircraft outright wasn’t enough of a subsidy, the lease deal throws an extra $12 to $20 billion beyond the sale price to Boeing.

Senator John McCain remarked, “I have never seen the security and [financial] interests of the federal government quite so nakedly subordinated to the interests of the defense manufacturer. Indeed, any objective analysis would conclude that the sole purpose served by this lease was to maximize the profits of Boeing.” (Seattle Weekly, 6/4/03)

After this deal was struck, even a mainstream columnist from the liberal Seattle Weekly demanded that Boeing be taken into public hands: “We could push to nationalize them. Boeing lives off the public dole anyway. We could either be done with their blackmail – which will only get worse – or take the controls of this flying porker ourselves.” (6/4/03)

Boeing is already making huge profits off subsidies from our tax dollars. If we fund Boeing, we should control it, too. By taking the aerospace juggernaut into public ownership under democratic workers’ control, Boeing’s profits and technology could be used for the benefit of all rather than war profiteering and exploitation.

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