LEE’S SUMMIT, September 14, 2011 – Boeing, unlike General Motors, Chrysler, and Ford is truly representing Management’s side in the Union negotiations that led to the decision to put the new 787 Dreamliner production in South Carolina. It is the right of the Union to seek the most possible during negotiations, and one of the tools in its rightful arsenal is the strike. It is also the right of the company to make capital expenditure decisions that are consistent with growth and profit. Both sides must bring strong arguments to the table and bargain as needed to achieve a mutually beneficial result.
In the years that led to the bailout of General Motors, Ford and Chrysler (Ford being in the best shape of the three refused the bailout and is doing remarkably well) tended have one targeted for a strike, then a healthy settlement increasing union benefits to the point where the companies were not only at risk, but also highly uncompetitive with foreign manufacturers employing non-union American workers. When gross profits are used up to pay union packages, little was left to fund innovation, and eventually it starved the pipeline and Detroit suffered.
Unions, as I claimed on a Blog a couple of years ago, did their job. They fought to get the most they could. Management at the old Big Three did not do their jobs and thus they allowed themselves to be put at risk.
Boeing is no such company. Boeing understands that it has a responsibility to shareholders (read 401K investors – as in you and I) and employees alike. They must grow, or they’ll fall behind. They must innovate or be surpassed. The must deliver or lessen their ability to profit from their innovation and highly skilled workforce.
The 787 is facing stiff competition from the often delayed Airbus. The more airlines need these superjets like the Dreamliner, the more they will have to buy from Boeing; for now they’re the only game in town. The advantage won’t last long, and customers are finicky. They want to spend the least, get the most, and have it earning money for them yesterday; otherwise they are gone to someone who can deliver.
The NLRB is there to ensure that all sides play fair – or as fair as it is possible in such situations. There is a difference between a company saying “since you voted for the strike, Mr John Q Worker we’re going to fire you, or demote you” and saying “we have two choices of where we can put this new plant, and the key for our long term profitability is to have a stable supply.”
The NLRB under current management appears to believe that any company that does not do as the Union wants is in violation of NLRB rules. The complaint filed against Boeing (see here) uses statements from Boeing executives referring to their decision as having to do with the work stoppages at the Washington facility as a violation of the National Labor Relations act and it further states that Boeing is guilty of Unfair Labor Practices.
I wonder what is most unfair to labor, to create jobs in both Washington and South Carolina, or to put the company on the same path as General Motors? Is it better for workers to be bailed out, or to work for a company that takes on the challenges of staying competitive, while at the same time bringing new jobs to America?
The interpretation of the NLRB could be extrapolated quickly to the fact that “any decision” not to put plants in unionized States is an Unfair Labor Practice. After all, if I don’t give a Union a chance by putting my new business in a Union friendly state, I’m actually keeping union workers from the right to work for them, and thus unfairly keeping them from jobs. Now, I admit that today that is a stretch, but if this precedent is allowed to stand, it will eventually lead to that. Maybe not for a new business, but certainly for a growing business within any “right to work” state.
The House is taking up a bill to rein in some of the NLRB’s newly self-augmented authority. It is time to call Congress and express our opinions.
The Lee’s Summit Conservative