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Jon Talton

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

April 1, 2014 at 10:14 AM

Your April 1st business news, fool

In a surprising turnabout, Boeing announced today that it will forgo nearly $9 billion in taxpayer incentives to build the 777X in Washington state and instead donate that amount for education, research, transit, parks, libraries and social services in the Puget Sound region.

“It’s the right thing to do,” Boeing Chief Executive James McNerney said at a press conference with Seattle City Council member Kshama Sawant. “We have record profits. Our stock price is at a record high. It’s a privilege to do business in a region with the world’s top aerospace cluster.”

McNerney also said the company will switch all employees’ retirement plans over to pensions from 401(k)s.

“I have a great retirement package, so why shouldn’t all our workers?” he said. “Everybody knows 401(k)s are second-rate. Of course, we will want to get the approval of our union partners in doing this. Labor peace and taking care of our people starts in my office. Don’t you think I learned anything from my mentor, Jack Welch?”

Also joining Sawant were top executives of McDonalds, who flew coach with McNerney on a red-eye from Chicago to save shareholders’ money. They announced that the fast-food giant will immediately raise its minimum wage to $20 an hour.

The moves came on the same day that billionaire oil barons and political activists David and Charles Koch said they would donate their fortune to the Bill and Melinda Gates Foundation for the development of renewable energy.

“Only an idiot would deny that climate change is happening because of the burning of fossil fuels,” David Koch said a day after a dire United Nations report. “We’ve decided to take the lead. It’s also time for President Obama to get off the fence and support a carbon tax.”

Among those applauding the decisions was Washington state Senate Majority Leader Rodney Tom, who made his own surprise announcement. He will return to the Democratic Party caucus and make a new transportation bill his top priority, including a Columbia River Crossing that links Vancouver, Wash., with Portland by light rail.

“For too long, politicians have made hay with the anti-Seattle meme,” Tom said. “Seattle is the economic engine that powers the entire state. We need to enhance that engine, not harm it.”

Restoring all the funding cut to Washington universities, plus adding millions more to lower tuition while enhancing research, will be another legislative priority, Tom said. Gov. Jay Inslee, after being treated for shock, applauded the moves.

So did activist Tim Eyman, who said he would put two initiatives on the next ballot. One would allow taxes to be increased by a simple majority vote in the Legislature. A second would establish an income tax.

“Taxes are the price of an advanced society,” Eyman said during a news conference held at the offices of The Stranger. “There’s no free lunch.”

Another bombshell came from the waterfront. Officials of the ports of Seattle and Tacoma announced they would consolidate operations in order to meet rising competition from merged ocean carriers, Canadian ports and a wider Panama Canal.

“Tacoma loves Seattle!” Port of Tacoma CEO John Wolfe said as he embraced his counterpart from the Port of Seattle, Tay Yoshitani. “In a competitive world, there is no place for petty parochial feuds.”

The only disappointing news came when a reporter asked Boeing’s McNerney if he would consider moving the company’s headquarters back to Seattle.

“No can do,” McNerney said. “I’ve become addicted to Chicago hotdogs.”

Today’s Econ Haiku:

For one day a year

Satire can hold our best dreams

Happy April Fool’s




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