SEATTLE — This is how the middle class dies, not with a bang, but a forced squeeze. After a global corporation posts record profits, it asks the state that has long nurtured its growth for the nation’s biggest single tax break, and then tells the people who make its products that their pension plan will be frozen, their benefits slashed, their pay raises meager. Take it or we leave. And everyone caves.
Well, almost everyone. All went according to script as the Boeing Company showed what to expect in a grim future for a diminished class — the vanishing American factory worker. The threats were issued, the tax giveaways approved, the political leaders warned of the need to buckle to Boeing.
This didn’t happen in a broken town with a broken industrial heart. It took place in one of the most prosperous metropolitan areas on the planet — Seattle — home to Starbucks, Costco, Microsoft, Nordstrom and Amazon.com, which is on its way to becoming the world’s largest retailer.
But then came the final item, a vote of the people who actually assemble the planes. By a 2-1 margin on Wednesday, the machinists of Puget Sound told Boeing to stuff it. With this act of economic suicide, the state could lose up to 56,000 jobs on the new 777X plane. Cue your metaphor — the Alamo, Custer’s Last Stand, Braveheart.
The events of the last few days show the utter bankruptcy of economic policy prescriptions offered by both political parties. You want tax breaks and deregulation — the Republican mantra? The $8.7 billion granted Boeing this week is the largest single state-tax giveaway in the nation’s history. It wasn’t enough. You want government training for schools and highly skilled workers — the Democratic alternative? There was plenty of that, to Boeing’s liking, in the package.
What Boeing wants is very simple: to pay the people who make its airplanes as little money as it can get away with. It needs to do this, we’re told, to stay competitive. It has all the leverage, because enough states — and countries — are willing to give it everything it asks for. Who wouldn’t want a gleaming factory stuffed with jet assemblers, a payroll guaranteed for a generation?
Boeing is on a roll, its stock at a record high despite the troubled rollout of its 787 Dreamliner, and the pay of its C.E.O. boosted 20 percent to a package totaling $27.5 million last year. It is not impelled, as the auto industry was five years ago, in the midst of bailouts and cutbacks. Boeing could afford to be generous, or at least not onerous. But it’s easier to play state against state, the race to the bottom.
What Boeing’s riveters, line-assemblers and welders want is a thimble of respect. People have been building flying machines in this region since young Bill Boeing rolled seaplanes out of a barn nearly 100 years ago. The machinists didn’t ask for hefty pay raises or new benefits as a condition to keep the much-promoted 777X production in this region. They just wanted to preserve what they had — jobs that could pay up upward of $80,000 a year, with a guaranteed pension.
“I’m tired of being slapped in the face,” said John Gilman, who has worked at Boeing for nearly 40 years. “Building airplanes — it takes years of training and skill. The people who run this company used to understand that. But now it’s run by bean counters and lawyers.”
Gilman was among the thousands of factory workers voting on Boeing’s take-it-or-we-leave proposal Wednesday. The anger was palpable. The president of the local machinists union had called the proposal “a piece of crap.” Others referred to it as “the Walmartization of aerospace.” As they voted, vultures circled, among them Gov. Rick Perry of Texas, who tweeted last week that his low-tax, low-wage state was ready to help Boeing.
One of the more tedious laments of our day is the bromide that we don’t make things anymore in the United States. In fact, we make plenty of things, including world-class airplanes. But the question is whether we can still pay the people who make them a decent wage.
Perhaps not. In the wake of the machinists’ rebellion, Boeing is likely to move. “We’re left with no choice but to open the process competitively and pursue all options for the 777X,” said Boeing’s commercial airplanes C.E.O., Ray Conner, after the vote.
So, off to Texas, where one in four people have no health care, or South Carolina, where a compliant work force would never think of putting up a fight? And who can blame Boeing? After all, pensions are a thing of the past, aren’t they? Wages and household income, across the country, have not risen in nearly 15 years.
This is supposed to be the age of the gig economy — every worker an entrepreneur. But it hasn’t translated to a fix of the greatest economic crisis of our times: how to preserve a declining middle class.
The distilled wisdom on this subject says that education — elevating minds, skills and critical thinking to match a tomorrow economy — is the way forward. And everyone in this tomorrow-economy state seems to agree. Except, look at what happened here, a parable for troubled times. The state agreed to subsidize Boeing to the tune of $500 million a year over 16 years. That’s twice what the state gives to the University of Washington, the region’s flagship college, long an elevator to the middle class. Maybe the university should threaten to leave town.