Obama Administration Clips Boeing’s Wings

Passenger Airliner overhead with stormy sky

Passenger Airliner overhead with stormy sky

At a jobs summit last Monday in North Carolina, President Barack Obama and his elitist friends joked that his Administration had no idea what a shovel ready job was when he misled the public to pass his trillion-dollar stimulus pork bill.

In addition to displaying his shocking lack of empathy, the President’s comments are at least a tacit recognition that his disastrous legislation failed to stimulate the economy.  So when a private company decided to build a new plant and hire 1,000 workers down the road in South Carolina, you would assume the Obama Administration would cheer that decision, right?


Last week, Obama’s National Labor Relations Board began legal proceedings against Boeing, arguing that the aeronautical giant must close its new 1,000 person nonunionized plant in South Carolina and move its operations to its unionized facility in Washington State.

The NLRB is upset because South Carolina is a Right-to-Work state and Washington is a Non-Right-to-Work state.  NLRB officials have accused the company of retaliating against its current union workers in Washington.

In 2009, due to increased demand, Boeing decided to invest around one billion dollars to construct a final assembly line plant for its 787 Dreamliner aircraft in North Charlestown, South Carolina.  Boeing already operates a similar facility in Washington, but it is not capable of meeting production demands.

Boeing’s new state of the art facility opened on June 10th, and the company added 1,000 new jobs to South Carolina’s coastal region.

Boeing’s decision was based on strategic, safety, and business considerations.  Testifying before the Senate Health, Labor, and Pensions Committee, Boeing General Counsel J. Michael Luttig said that the company considered the Washington site, but the union was not willing to fairly negotiate, and that,

made the overall business case for North Charleston more persuasive, as did the general business climate, the desire for geographical diversity in final assembly, labor costs, and South Carolina’s willingness to make available hundreds of millions of dollars of incentives.

An NLRB administrative law judge in Seattle is currently hearing the dispute.

In April, the NLRB filed its initial complaint. The NLRB claims that Boeing opened its South Carolina plant as retaliation towards it Washington branches.  The complaint alleges that Boeing built its plant in South Carolina to punish its Washington branches that regularly strike.  Boeing’s most recent work stoppage in 2008 lasted 58 days and cost the company $1.8 billion in revenues.

The NLRB lawsuit is unprecedented.  It is an incredible leap for a federal agency to ascribe motivation to a company without sufficient proof.  It is incredible, but not surprising.

It is not surprising because President Obama appears to have tasked his administrative agencies with promoting parts of his extreme agenda that stalled in Congress.

Can’t get a comprehensive cap-and-trade bill passed?  That’s okay; Obama will just have the Administrator of the Environmental Protection Agency Lisa Jackson regulate carbon dioxide emissions.  Want to halt oil drilling in the Gulf of Mexico without congressional approval? That’s okay; Obama’s lackey, Secretary of the Interior Ken Salazar, will issue repeated moratoriums in spite of a judge’s order to the contrary.  Don’t have the votes for card check?  That’s okay; Obama will dispatch the NLRB to sue companies that try to do business in Right-to-Work states.

During Obama’s tenure, the NLRB has taken a dramatic ideological turn.  Even the far-left New York Timesobserved that,

under President Obama’s appointees, the agency … has sought to reinterpret and more vigorously enforce the rules governing employers and employees.

The rule that the NLRP wants to reinterpret eliminate is section 14(b) of the Taft-Hartley Act, which allows states to pass Right-to-Work laws.

The NLRB’s lawsuit is reminiscent of “Calvinball,” the chaotic game Bill Watterson created for his iconic comic strip, Calvin and Hobbes.  Calvinball is combination of team sports and playground games that has only one rule: the game is never played the same way twice.  This is the confusing environment our federal government expects private businesses to operate.   From one day to the next, corporations worry that an aggressive (and unelected) bureaucracy will reinvent the wheel and rewrite the rules of the game.

In Boeing’s case, its leaders made a decision to build a massive new plant, spent one billion dollars to construct it, hired 1,000 workers, and then the feds demanded they shut it down.

It is a wonder that any company does business on American soil under these conditions.  If corporate leaders have no certainty regarding regulatory impact, they cannot hire new employees and make major business decisions.  The result is a stalled economy and large unemployment – exactly what America is experiencing.

Senator Jim DeMint (R-SC) describes the NLRB action as “extremism.”  DeMint points out that the NLRB performs little work related to its mission and instead uses taxpayer money to engage in liberal skullduggery.

DeMint looked at the numbers, and found that:

The NLRB was originally established to oversee union elections and investigate violations of federal labor laws.  These days it’s doing less of that than ever.   In 1980, the NLRB conducted 8,531 union elections around the country, with a budget of $108 million.  In 2009, it oversaw only 1,704 union elections, with a budget of $261 million.

The NLRB sounds like a public-sector union – demanding more taxpayer money for less work.  DeMint continues his analysis:

Union membership has plummeted by more than 40% since the 1980s.  The rapid collapse of organized labor in America’s private sector has reduced the need for union elections—and thus, the NLRB itself—by 80% over the last three decades.  Yet its budget—adjusted for inflation—remains essentially unchanged.

Hence the board’s recent drift into freelance assaults on economic freedom:  While 20% of its budget may be needed to perform its real job, the board seems to be misusing the other 80% for ideological mischief.

Idle hands are the devil’s playground, and idle tax-dollars appear to be the liberal regulators’ ideological slush fund.

In an unusual step, 16 state attorneys general joined an amicus brief in support of Boeing.  Members of both political parties signed the brief, and more importantly, both Right-to-Work and Non-Right-to-Work states signed on.  Those state leaders are concerned that the NLRB is overstepping its bounds and its actions will send American jobs overseas.

According to South Carolina’s Attorney General Alan Wilson,

Unless deterred, the NLRB’s unprecedented proceedings against a company’s private business decisions will cause irreparable harm to the business climate in every state and will undoubtedly create an exodus of jobs from our country.

Perhaps comically so, the NLRB’s boorish behavior may have the unintended consequence of harming the pro-union states it hopes to protect.  The brief writers explain,

the [NLRB’s] approach to Boeing will actually harm non-right-to-work States’ ability to attract new businesses, jobs, and economic development opportunities.  New or fledgling companies are now aware that locating new facilities and creating new jobs in a non-right-to-work State could handcuff their ability to open future factories in right-to-work States.  As a result, it is logical that some employers will simply avoid creating new jobs or facilities in non-right-to-work States in the first place.  For these businesses, the safer course of action could limit their operations to right-to-work states like South Carolina.

Under Obama, the federal government has proven to be extraordinarily inept at job creation.  Poll numbers show that the public is dissatisfied with Obama’s handling of the economy.  Perhaps if he got his regulatory cronies out of the way, Boeing, and other businesses large and small, could resume hiring and get things back on track.

The National Center for Public Policy Research is a communications and research foundation supportive of a strong national defense and dedicated to providing free market solutions to today’s public policy problems. We believe that the principles of a free market, individual liberty and personal responsibility provide the greatest hope for meeting the challenges facing America in the 21st century.