Top of the News: Northrop Grumman’s threat to pull out of bidding for the Air Force tanker contract falls into the “I’ll believe it when I see it” department. If it comes true and Boeing is the sole player in the process, it would be very good news for the Puget Sound, with the $35 billion worth of planes being built in Everett.
Northrop has teamed with Airbus parent EADS to build the tankers off an A330 in Alabama. The idea of Airbus getting what would essentially be a federally subsidized factory in America makes Boeing executives as angry as, well, the machinists’ union, maybe more so. Losing the tanker contract would be another blow to growth of Boeing work here.
Still, Northrop is also playing a political game, demanding major changes to the Pentagon’s parameters for the tanker bidding, and you can bet it will have the support of Alabama’s congressional delegation. Here’s another gut check for Washington state leaders.
The Midweek Briefing: Unemployment rates were higher in October for all 372 metro areas surveyed by the federal Bureau of Economic Statistics. A total of 124 had rates of 10 percent or higher, vs. just 13 a year earlier. Seattle-Tacoma-Bellevue: 9 percent, vs. 5.3 percent in October 2008.
President Obama “has packed his economic team with Wall Street insiders intent on turning the bailout into an all-out giveaway. Rather than keeping his progressive campaign advisers on board…Obama gave key economic positions in the White House to the very people who caused the economic crisis in the first place.” So argues the always provocative Matt Taibbi from Rolling Stone.
–Historian Naill Ferguson makes the anti-Keynesian case in a Newsweek essay, saying the federal deficit and indebtedness to China are a looming disaster. “This is how empires decline. It begins with a debt explosion.”
–On the other hand, Harvard’s Jeff Frankel argues the federal budget can be brought around. He offers ten major fixes. Among them: raise the gas tax, cut agricultural subsidies and continue to reduce expensive weapons systems.
–Overdraft fees for banks and credit unions rose 35 percent from 2006 to 2008, according to the Center for Responsible Lending.
Today’s Econ Haiku:
GM on the Fritz:
Hey, don’t let the door hit you…
We own this clunker