I have written many times about right to work laws and their potential to spur economic prosperity and development. The right to work generally refers to laws which make it optional to join a union by preventing the existence of the “closed shop” where one is forced to join a union in order to work. In a signal to his union allies that he needs their backing ahead of the 2012 election cycle, President Obama’s National Labor Relations Board has filed an unprecedented complaint against Boeing for opening a new production facility in South Carolina, a right to work state. As shocking and unbelievable as this may sound in the United States of America, the administration is seeking an order from an administrative law judge to force Boeing to move production of the 787 Dreamliner to the union heavy state of Washington.
Union bosses are stridently opposed to right to work laws because they force the union to compete for membership by demonstrating their value to the workers. Right to work states have also been at the forefront of economic growth and development for decades even as the union heavy states of the old rust belt have been declining in population and hemorrhaging jobs. The classic comparison is the “transplant” automotive factories of foreign car companies dotting right to work states in the South, churning out top performing automobiles and creating more jobs each year. Contrast this to the depressing performance of the union heavy plants the big three domestic auto makers still maintain in the Northeast and Upper Midwest.
Turning back to the Boeing case; Boeing identified a need for greatly expanded production to meet increased demand for their marquee new product, the 787 Dreamliner. To fill this demand Boeing invested billions and created thousands of jobs building a new production facility in South Carolina, a right to work state. Boeing’s CEO, Jim McNerney has stated that part of the decision to locate the new facility in South Carolina was the substantial cost of the multiple strikes Boeing has faced at its plants near Seattle over the past decade. For years McNerney has talked about the need to shift production from Seattle to a more diverse set of locations.
The move by the National Labor Relations Board (NLRB) to file a complaint against Boeing based on their decision of where to locate a production facility is unprecedented but not surprising. President Obama has spent the past two years packing the NLRB with radical allies such as Craig Becker. Becker once worked as a lawyer for the Service Employees International Union and has written that the NLRB could impose “card check” rules for union organizing, removing the secret ballot and allowing union thug intimidation of non-union employees, without an act of Congress. Obama installed Becker with a controversial recess appointment because even the Democrat Senate refused to confirm him.
This move is about one thing, letting the union bosses know that Obama will do what he has to do for their support; even bend the law and punish non-union workers like the employees of Boeing’s plant in South Carolina. Though the union bosses may no longer represent what is in the best interest of the employees, they do represent what is in the best interest of their own wallets and Obama needs to keep their wallets fat because he will need their donations for his reelection campaign. What is most ironic is that Boeing is attempting to expand production and create jobs in the midst of this economic crisis and the administration is seeking to punish them for it.
If the NLRB gets their way it may also be the death of right to work laws and the ability of firms to create jobs and expand the economy. The National Right to Work Committee, an organization dedicated to preserving freedom of choice among workers, has even launched a new fundraising effort based on this issue and its potential to bring our fragile economic recovery to a screeching halt. Regardless of how this turns out the lesson other companies will take is clear; don’t even bother trying to expand in the U.S., best to move your whole company, along with the associated jobs, out of the U.S. and to a country that still supports economic growth.