Labor Unions Keep Boeing From Giving People Jobs

boeingBoeing is trying to open a new factory in South Carolina that would employ people to build airplanes. Unemployment in the country is still high, and getting people back to work creating things that other people want to buy is a very good thing.

Here’s how an economy works: Cobbler Joe makes excellent shoes, but his wife really wants a purse for her birthday. So Cobbler Joe works extra hard in his shoe shop creating excellent shoes that he can sell for a decent price. When he has enough money saved, he goes down the street to Polly’s Purse Shop where he purchases a fabulous handbag for his lovely wife. 


When Polly sees Cobbler Joe, she’s reminded of the pair of purple satin stilettos she wants, and asks Joe if he has any in stock. He does, and she stops by later and purchases them. Or she goes to Jim’s Shoe Shop because he’s selling them at a discount. Or maybe she goes back to Joe who will price-match them. 

An economy is made of people creating goods and services that others want to purchase. To purchase them, they must create something worthy of someone else purchasing it. To get cooler stuff, you have to work harder so that the value of your service is worth more, and you get paid more. 

Let’s get back to Boeing, the airplane-making company. It wants to make a good product, which means it has to purchase quality materials and pay its employees enough so that the best workers will want to work for it instead of Airbus. It also wants to sell its planes at a decent price, so customers will choose it over other options. The tricky part is finding the right balance.

The economics get even trickier when the National Labor Relations Board gets its panties in a twist over Boeing choosing to expand operations in South Carolina instead of Washington. Boeing has a big presence in the Seattle area, and the union says that the company chose a right-to-work state as some kind of retaliation against the Washington Boeing workers being unionized. 

(Side note -- a right-to-work state means that there are state laws that protect individuals from being forced to join a union in order to keep their jobs.)

This is not true. Boeing’s president Jim McNerney explains its decision to expand in South Carolina:

Our union contracts expressly permit us to locate new work at our discretion. However, we viewed Everett as an attractive option and engaged voluntarily in talks with union officials to see if we could make the business case work .... Despite months of effort, no agreement was reached. Union leaders couldn’t meet expectations on our key issues, and we couldn’t accept their demands that we remain neutral in all union-organizing campaigns and essentially guarantee to build every future Boeing airplane in the Puget Sound area. In October 2009, we made the Charleston selection.

Now the National Labor Relations Board is upset with Boeing for choosing to work in a more business-friendly environment, instead of bending over backwards and making unrealistic promises to the union bosses. NLRB Acting General Counsel Lafe Solomon wants to shut down construction on the nearly complete facility in North Charleston and change the location to Washington. 

The National Labor Relations Board would like to tell a private company where it can and cannot operate. They want to force a business to kowtow to unrealistic demands that might put it out of business someday. They think it’s reasonable to abandon a nearly complete facility and start over in a different location 3,000 miles away. Who would foot the bill for that one? 

This is ridiculous and the NLRB needs to knock it off. Washington said, “My way or the highway,” and Boeing executives responded, “Ok, bye!” Washington had a chance to work with Boeing to create the jobs there, but they refused to compromise. So the jobs were created in South Carolina instead.

It doesn’t look like the union was looking out for the little guy after all. 


Image via Aaron Escobar/Flickr

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