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April 29, 2011

A Ruling for the Worker?

Joe Charlebois

For those who don’t believe the tentacles of our federal government are anti-capitalistic, you need look no further than the latest National Labor Relations Board (NLRB) overreach.


According to the statement released by the NLRB, it is seeking an order to have Boeing shelve their $2 billion plant in South Carolina and create a second production facility in the state of Washington to produce the Dreamliner 787.


Boeing – which originated in Seattle – calls Chicago, IL, its corporate home and has a presence in all 50 of the United States, as well in Europe, the Middle East and Asia. Its move to build an additional production line in South Carolina should not be seen as abandonment of Washington, but rather the continued growth of an international company that is one of the United States greatest exporters.


Boeing chose to build the new state-of-the-art facility just north of Charleston to accommodate the great increase in orders for the Dreamliner.


Being an international company, Boeing could have easily chosen to build these planes overseas where it would have been welcomed with open arms. Instead, they chose South Carolina which is home to over 100 aerospace companies and is widely considered to be one the most business friendly states with a ready and skilled labor force.


South Carolina is a right-to-work state and, as such, is much less likely to experience the labor unrest that Boeing has experienced with the International Association of Machinists and Aerospace Workers in the State of Washington.


With that in mind the NLRB issued their statement that Boeing was guilty of unfair labor practices.


The April 20, 2011, news release states the Boeing has “violated federal labor law by deciding to transfer a second production line to a non-union facility in South Carolina for discriminatory reasons.”


To remedy the alleged unfair labor practices, the acting general counsel seeks an order that would require Boeing to maintain the second Dreamliner production line in the State of Washington. The complaint does not seek closure of the South Carolina facility, nor does it prohibit Boeing from assembling planes there; it just can’t produce the Dreamliner in a right-to-work state.


The fact is the second assembly plant in South Carolina will not take any positions from the existing plant in Washington. This facility was built to make sure that Boeing could deliver the premiere passenger airliner on a timely basis and keep companies such as Airbus – which benefits from government subsidized loans – from continued international dominance.


Airbus has out delivered Boeing in each of the last eight years and is on pace to do so again. Concerns over future orders and the ability to deliver Dreamliners to waiting customers was the reason to build a second plant. Choosing to build it in South Carolina just makes financial sense. The last strike against Boeing – which lasted two months – cost Boeing $1.8 billion. It is unknown how much further business they lost in potential orders.


Despite the opinion of the NLRB that this plant is discriminatory toward union labor, no one in the Washington-based assembly plant will lose their positions. Boeing is not transferring any of their Dreamliner assembly jobs to South Carolina, but rather is adding an additional facility in what can only be seen as a financially sound business decision.


South Carolina is home to over 100 aerospace-related companies both foreign and domestic. It is home to BMW’s only North America plant. Mercedes produces the Sprinter van in South Carolina. Michelin, Bosch, Cummins, and Bridgestone America call South Carolina home. This is the new home to industry in the United States. This is where employees are paid higher than average wages without the “aid” of forced unionization.


Did Boeing build their second line of production in South Carolina to reduce costs, minimize work stoppages, and avoid the detrimental negotiating tactics of the International Association of Machinists and Aerospace Workers? Yes.


If the answer is yes, then was it discriminatory toward the workers in Washington in a way that was harmful to their livelihoods?


The short answer is “no.” It will have no financial impact on the existing employees of Boeing. What it will affect is the influx of additional mandatory dues to the International Association of Machinists and Aerospace Workers unions.


As we’ve been told by George Orwell in “Animal Farm,” some animals – workers – are more equal than others. It seems that in their latest ruling the NLRB agrees with Snowball.


[Note: According to the American Institute for Economic Research, the International Association of Machinists and Aerospace Workers Union ranked twelfth in the amount of political contributions from 1990 to 2010 with over $24 million in donations. Over 99% of those contributions went to Democrat politicians.]


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