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Kill Economic Freedom; Kill Job Creation

After Boeing announced its plans to locate a Dreamliner production site in South Carolina, the National Labor Relations Board (NLRB) stated its position that Boeing should restrict production to Washington state. The NLRB was against the airline manufacturer creating jobs in South Carolina (there were no plans to eliminate the jobs in Washington) where there are lower costs and business conditions are stable.

Kill Economic Freedom; Kill Job Creation

What is behind the attempt by the National Labor Relations Board (NLRB) to enjoin Boeing from completing its Dreamliner production plant in South Carolina, a year and half after the company announced its decision to build there? The acting general counsel’s complaint that Boeing transferred a second 787 Dreamliner production line of three planes per month from Washington to a non-union site in North Charleston to punish workers who had gone on strike isn’t supported by the facts. The company has a backorder of 850 aircraft. Boeing employs 1,000 workers working on the first line in Everett, Wash., and no one will be laid off. The 1,000 new jobs that are anticipated in South Carolina are being put at risk because in an extraordinary regulatory overreach the NLRB insists that all such production be restricted to the state of Washington.

Is it any wonder that the company has had enough of work stoppages that average one every three years, resulting in a million hours of lost labor for 27,000 employees in that state? Boeing selected a second production line in a state where the costs are lower and the business environment is stable—a fact confirmed by South Carolina’s ranking as the eighth best state in which to do business in Chief Executive’s annual survey of Best/ Worst States for Business (May-June 2011). Washington State ranked 34, down from 30 in last year’s survey.

Boeing has facilities in 34 states around the country, half of them in right-to-work states. “While this happened in South Carolina, it is also terrible for our country if the government can dictate where American companies can and cannot create jobs,” said South Carolina governor Nikki Haley. “It’s an assault on our economy and all of us.” And perversely such will be the unintended consequence of this regulatory bullying. But surely both the NLRB and President Obama, who refuses to rein the agency in, know that once Boeing joins the legal battle it will prevail.

The real point of this maneuver is to intimidate other companies, those with fewer lawyers and lobbyists and pockets not as deep as Boeing’s, to do organized labor’s bidding. In true Chicago-style political persuasion, the administration in effect is saying, “Nice company ya got here. Too bad if something should happen to it.” Trouble is, the effect of Chicago-style bare-knuckle politics in company boardrooms will be quite different than what the administration intends. Ironically, if Boeing had expanded its production in China, Mexico or Canada none of this would have happened. If the forces of aggravated lawlessness prevails, the lesson will not be lost on others.

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