Top of the News: Washington has made its case for a second assembly line for the Much Delayed 787 Dreamliner. No new incentives. It’s based on quality: a highly skilled workforce, one of the world’s largest aerospace clusters, experience, knowledge, synergy. That necessarily costs more than suburban Charleston, S.C., but you get what you pay for.
Fatalists believe Boeing has already decided to go to South Carolina. It has chosen cheap. That, after all, was one of the defining management behaviors that led to delays and mistakes in the development and building of the 787. Cheap is everything. Cheap is the future. You can take the poll below and comment — did the state do enough?
It’s not as if Boeing has been abused here, despite having to negotiate with workers that have some say, through their unions, in their future. Washington gave Boeing $3 billion in tax breaks and incentives to win the first 787 assembly. But in the new world order, transnational companies can count on states, cities and countries to bid against each other to give the corporation the best deal.
The Back Story: Today’s report of a drop in consumer confidence is not Americans copping an attitude. Acting petulant, say, because the bankers got to keep billions in bonuses and are back to selling swindles…I mean derivatives…while we just get our fees jacked up and houses foreclosed.
The confidence measure, which bodes ill for the critical holiday retail season, is an inevitable outgrowth of the “recovery.” Consumer debt remains at record highs, while unemployment and underemployment tops 16 percent and six jobless people are competing for every open job — a record. The big credit card that was home equity loans has been revoked. People are saving with the frugality of the fearful.
Turnarounds can come quickly, but even in the 1990s and early 2000s, jobless recoveries dragged on for months — and we weren’t nearly as underwater as today. For Seattle, the poignant question becomes, which distinctive local retailers won’t make it after this year?
Today’s Econ Haiku:
A new merger boom?
Wall Street dons Prada, Gucci
Workers get pink slips