The most important vote of 2014 - Boeing 777X contract
Although 2014 is a general election year with control of the Legislature up for grabs and still unknown ballot measures yet to qualify, perhaps the most important vote of the year will be tomorrow on Boeing's 777X contract offer. Not only does this union vote have the potential to impact tens of thousands of jobs, but it could dramatically change the state's fiscal outlook, not to mention its economic psyche.
While a "Yes" vote would ensure the 777X is produced in Washington, what could a "No" vote mean for the state, besides the potential loss of future Boeing jobs and ripple effect on the economy? According to Bloomberg:
Washington faces a credit downgrade, higher borrowing costs and the loss of jobs and tax revenue should Boeing Co. (BA) decide to move production of its new 777X jetliner to another state . . .
The company’s production line for the 777, the earlier version of the twin-engine model, is in Everett, a city of 105,000. With more than 30,000 workers at the plant, 'a drawdown or transfer of those workers would have a ripple effect,' said Pat McClain, Everett’s executive director for governmental affairs.
If Boeing selects a new location, it would be a 'credit negative' for Washington state and the Puget Sound region, according to a Nov. 21 report by Moody’s Investors Service. 'The regional economy would lose a potential engine of growth and the local and state government would forgo potential tax revenues.' . . .
Losing 777X production 'will raise the cost of capital -- could be several hundred million dollars,' James McIntire, Washington state treasurer, said in an Economic and Revenue Forecast Council meeting in Olympia on Nov. 20 . . .
'It’s not just losing one airplane’s production, it could be the start of a Boeing exodus,' said JC Hall, chairman of the Redmond, Washington-based Pacific Northwest Aerospace Alliance, an industry group.
With so much at stake it's no surprise to see a union rally planned for 4 p.m. today on the Boeing 777X contract offer. What is a surprise, however, is what the union rally is encouraging - a "No" vote.
Western Washington political and business leaders had a sobering message for the Machinists union on Monday: Rejecting the Boeing Co.'s latest contract offer will mean losing thousands of jobs and risk the future of the state's aerospace industry . . . Elected officials from Everett, Renton, Kent and Snohomish County on Monday urged IAM members to approve the contract.
A "No" vote tomorrow may also have the potential to shake up what was otherwise shaping up to be a sleepy 2014 Legislative Session.