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Boeing, Boeing, Gone

Opinion Editorial
May 18, 2001

By Mike Krause

The exercise in self-degradation by Colorado local and state government officials before the altar of all things Boeing continues. The latest in the saga was a super-secret, closed-door, no-media-allowed April 11th meeting in Denver between some Boeing reps and state and local economic development officials.

This begs the question, why does a corporation need to meet (behind closed doors) with government economic development types concerning a potential headquarters move to Colorado?  Are they seeking advice on how to move from one state to the next?  Doubtful. You would think that a company that can build a 747 is also capable of making the necessary arrangements to relocate (there are private companies that do that kind of stuff for a living).  Are they seeking permission to come to Colorado?  Of course not, they dont need it.  The U.S. Constitution guarantees freedom of movement across state lines.

A reasonable conclusion is that Boeing wants to know what kind of basket of corporate welfare goodies will be waiting on the conference room table should they pick Colorado. While Boeings CEO has said he doesnt want to start a bidding war, that doesnt rule out an initial offer. Of course, it is hard to blame Boeing for seeking a good deal when so many politicians are so happy to oblige.

Governor Owens has claimed that the state wouldnt engage in such a bidding war, but did say state and local governments probably will provide modest economic incentives. (1) But does that mean one-piece swimsuit modest, or G-string bikini modest? Mayor Webb, in an April CNBC Squawk Box appearance, said Denver would also exhibit modesty, but the Denver Post reported in March that the DIA business partnership was already formulating an incentive package within days of the original announcement. (2) Was the Post simply mistaken?

Also in March, Joseph Snell of the Metro Denver Network and the Denver Metro Chamber and who was also at the secret meeting said, “We are launching a full court press, we really have to pull out all the stops and get creative.” But other than espousing the quality of life and general business climate in Colorado, which has been done ad nauseum, what creative tools are really available to such organizations besides tax breaks and other financial incentives?

Perhaps it is time for some open door clarification.

Mayor Webb also claimed that the Boeing courtship would not become a PR circus, but its a bit late for that.  That the Mayor of Denver was willing to go on national television (CNBC) to pitch woo to a corporate chieftain gives the whole thing a carnival air, slightly seedy, but not un-amusing. As does the letter-writing campaign of the Governor, both Colorado Senators and at least one member of Congress. As does the forming of the Boeing 100, all for a company that has already said it will cut its headquarters staff in half as part of the move. Sorry folks, but the big tent has been pitched and the high wire act is warmed up.

The whole Boeing drama has become reminiscent of the movie “Moses,” where leaders of other states came before Pharaoh on bended knee, offering gifts of precious gems, silks and spices, hoping to curry the favor of Pharaoh, whose armies were on the move.  Only now, Pharaoh is a corporation, gems and spices are replaced with public subsidy incentives and those on bended knee arestill on bended knee.

But being on the dole is nothing new to Boeing, it is already a recipient of federal corporate welfare through the Import-Export Bank, which provides tax-dollar-backed loans, guarantees and credit insurance to guarantees and credit insurance to some of America’s largest and wealthiest companies. In fact last year, Boeing accounted for nearly 25% of the Ex-Ims subsidy. (3) Fortunately, that gravy train may be coming to a stop.

The Bush administration recently announced plans to cut the lending authority of the Ex-Im by as much as 25%. A spokesman for the Office of Management and Budget put it best: “As we try and slow the rate of (government) growth and spending, spending on things such as corporate subsidies need to be diminished.” Someone should explain that concept to the members of Colorados “Team Boeing” before things get any sillier.

If Boeing wants to come here on its own steam, then great.  Welcome, and I wish them well.  But if the first thing that Boeing plans to do upon arrival is to go on welfare, then lets let Chicago or Dallas have the honor of taxing working people in order to give money to corporate giants.

(1) Denver Post, March 22, page 1
(2) Denver Post, March 22, page 19A
(3) Wall Street Journal, March 29, page A-16

Mike Krause wrote this article for the Independence Institute, a free-market think tank in Golden, https://i2i.org.

This article, from the Independence Institute staff, fellows and research network, is offered for your use at no charge. Independence Feature Syndicate articles are published for educational purposes only, and the authors speak for themselves. Nothing written here is to be construed as necessarily representing the views of the Independence Institute or as an attempt to influence any election or legislative action.

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