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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

December 16, 2009 at 10:15 AM

After first flight, going back to find some lessons for Jet City

Top of the News: Now that the 787 Dreamliner has made a successful first flight, let me venture into the mine field. Back to Boeing’s decision to place a second assembly in North Charleston, S.C., and try to make it stand independently of the Puget Sound.

As a former manager, I’m interested in actionable lessons rather than useless blame. This is a conversation we need to have. But, as I’ve written, we’re not going to lower our living standards to those of the South, or for that matter our values. So what can we usefully learn?

Our relationship with today’s Boeing has become like the classic Far Side cartoon. What we say to dogs: “Okay, Ginger, I’ve had it! You stay out of the garbage. Understand, Ginger? Stay out of the garbage or else!” What dogs hear: “Blah blah, Ginger. Blah blah blah blah blah Ginger blah blah blah…”

So, whether we like it or not, and whether it’s fair or not, Boeing’s brass holds a red-hot grudge against the machinists for their strike. Boeing also — if it’s like any other transnational corporation — doesn’t care what we did for it in the past. Wall Street is focused on the immediate gratification future, and so are those executives. That their more costly blunders are not punished to the degree of the union’s strike is today’s tough-luck America. Same thing with the loss of the old Boeing to a McDonnellized culture.

Boeing has long leveled complaints that have nothing to do with labor costs or taxes. Specifically, it worries about the quality of education, infrastructure (including rail) and the slowness to take action here. These are valid and should provide a “hair on fire” moment for the political and business leadership.

As for the unions, they’re in a box. A strike next time around and it’s all over for Boeing in the Puget Sound. So they face a future of steady givebacks, which of course coincides with the overall decline of the American middle class. The machinists rolled the dice and lost.

The union may have divided interests and may also have been badly led. But the balance of power that once gave unions and working people more say in American life has been steadily eroded by years of public policy changes, union missteps and well-funded anti-union media campaigns. Can the Boeing unions find a way to serve their members’ interests and work with the company? Will the company deal in good faith?

The Puget Sound region continues to offer a high-quality home for Boeing’s commercial airplanes and, if it works out, the new tanker. It will cost Boeing more to replace this talent and infrastructure elsewhere than to find concord here. But every party will have to work to make this happen — and each has legitimate differences. Meanwhile, the global economy flies on.

The Midweek Briefing: As what TPM calls the Nopehagen Summit continues, here’s an elegant cheat sheet comparing views of climate change “skeptics” vs. the scientific consensus. We report, you decide.

— When commenters talk about Seattle becoming “the next Detroit,” it’s not only a wild stretch — completely ignorant of history and differences between the two cities — but it trivializes what’s happening in the Motor City. Unemployment may be at 50 percent. That should concern all Americans.

— Just so I can get Tiger Woods sex scandal in the keywords of this blog, I pass along this assessment by Harvard’s formidable Rosabeth Moss Kanter. She wonders if the l’affaire Tigre will cause a general pullback in celebrity endorsements.

— Now Let Me Get This Straight Dept.: The government projects that the economy will add 15.3 million jobs by 2018. The working population is expected to grow by 12.6 million. So far, so good. Unstated is that we now have nearly 16 million unemployed Americans, millions more still underemployed or discouraged workers. Not good.

Today’s Econ Haiku:

Ben, man of the year

But to his Fed-up critics

He’s on borrowed time

Comments | More in Aerospace/Boeing, Midweek Economic Briefing

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