What is almost lost in the celebration of the Boeing Machinists vote last Friday to accept the company’s long-term contract offer was how the militant leaders of the local Machinists union so totally misrepresented that offer. Their deception almost resulted in the contract being voted down, which would have meant the newest Boeing plane would be built in another state. The labor bosses weren’t alone in their deception, they were joined by vocal Democrat legislators and liberal activists in denouncing the company.
Just consider the truly ignorant remarks of State Representative Chris Reykdal, as he demonstrated his lack of understanding of economics:
“This is a very bad deal for the taxpayers and voters of this state,” he said. “The taxpayer should wonder why they just gave away 8-plus billion dollars to a company.”
What Reykdal, up until now a largely unknown second-term elected official from Thurston County, doesn’t seem to realize is the way tax incentives work and what happens when a company moves jobs out of state. The so-called “giveaway” that Reykdal attacks was the vote last November to extend — by 16 years — tax incentives which are already in place through 2024. Yet, if Boeing had moved production of the 777X to another state — as the company said it would if the incentives were not extended — there would have no tax revenue after 2024.
So, essentially the legislators voted to keep the company paying a wide variety of taxes (on property, employees, etc.) after 2024 while building the 777X here. The taxes just weren’t high enough to keep left-wingers like Reykdal happy.
He wasn’t alone in lying about what the tax vote meant. John Burbank, who runs what is generously described as a liberal think tank – the Economic Opportunity Institute — made a similar argument in a column in the Everett Herald (Dec. 19 column), writing:
“You could draw a flow chart showing the $9 billion in legislatively-approved skipped taxes in Washington state going straight to Boeing shareholders. This tax package had nothing to do with saving jobs. It had everything to do with being greedy.”
Again, Burbank ignores the fact that no tax dollars would have been generated for the state had Boeing moved the 777X jobs out of state – but then ignoring facts is par for the course for Burbank, who thankfully lost a Democrat primary race for a state House seat in Seattle a few years back.
Of course, had he won that race, he and Reykdal would have by now undoubtedly become the leaders of the House Democrats’ Economic Ignorance caucus.