How much is Boeing worth here? Plenty

October 15, 2014

If you want to see the dilemma policymakers and elected officials face when forced to hand out billions of dollars in corporate welfare to Boeing — and the company still announces it will make 777X parts in St. Louis, not the Puget Sound — study this map from the Brookings Institution:


[by Jon Talton | October 7, 2014 | Seattle Times]

Several reactions come to mind: arresting, outrageous, heartbreaking. The map tracks the metros that make up the backbone of America’s productive economy and, oh, what a fall.

Specifically, the map focuses on “the geography of America’s R&D- and STEM worker-intensive ‘advanced industries,’ which range from aerospace and automotive manufacturing to software and other high-tech services.” It shows how difficult it is to “reshore” manufacturing after so much damage to our industrial base. “The erosion of the local knowledge, skills and supplier base has greatly complicated the scale-up of returning firms.”

The causes are many, but much of it has come from policy changes and bad trade deals that have led to a race to the bottom. To a situation where big companies can play states and metros off against each other for the relative crumbs of what was once the mightiest producing nation in the world — and the well-paid, secure jobs that went with it.

The Puget Sound region is still standing as a major manufacturing center (Portland, too, thanks to Intel). And while software and information jobs have become important, nothing can replace the aerospace cluster built around McDonnell Douglas…ooops, Boeing. (A case of columnist’s Tourette’s there).

As of June, the most recent month available, more than 95,000 people in Washington worked in aerospace products and parts manufacturing. About 80,000 of them worked for Boeing.

Almost 110,000 worked in “information,” broadly defined by the U.S. Bureau of Labor Statistics. But somewhat fewer worked in guaranteed higher-paying fields of computer systems design (44,000) and software publishing (55,200).

These fields, as critical as they are for the towering advantage Seattle enjoys over most places, don’t provide the foundation for the blue-collar middle class found in aerospace. Nor does the narrow definition of aerospace manufacturing pull in the much larger “ecosystem” of the cluster and the jobs beyond that it supports.

So the dilemma. Compared to You-Know-Who, Microsoft and Amazon don’t ask for much from Olympia. So if you’re a policymaker do you want to say “no” to Chicago and put tens of thousands of local jobs at risk? Even if you are being unfair to so many other businesses?

The “free market” won’t save you. It’s a gamed market, law of the jungle, Americans against Americans for dwindling good jobs. And an educated workforce and high quality of life, as important as they are, won’t be enough to prevent your metro from being erased from the map, left to depend on jobs at call centers, Wal-Marts, fast-food joints and, if you’re lucky, an Amazon warehouse.

The answer is tough. But so far, the taxpayers’ “investment” in “incentives” to Boeing has probably repaid more than its expense. The answer for the future is more problematic.

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