Recently in South Carolina, the first shovel of dirt was turned on the construction of a new plant for the second line of Boeing’s 787. The Boeing Company announced Oct. 28 it had chosen Charleston over Washington to build its $750 million aircraft assembly line, which will create 3,800 direct jobs.
Although the news is disappointing, it is not surprising, given the Legislature’s reluctance to improve Washington’s business climate. Boeing warned us years ago about the state’s regulatory atmosphere. In 1993, then-Boeing Chairman Frank Shrontz said, “The difficulty in doing business in this state, and to some extent, the tax structure, are not a positive influence. We would like to have the opportunity to grow here, but we do need relief.”
In 2000, just two years before Boeing moved its headquarters from Seattle to Chicago, ex-Boeing Chief Financial Officer Debby Hopkins said, “We want to grow in Washington. Unfortunately, right now, Washington isn’t a top competitor. The business climate isn’t right.”
That was nine years ago and the state’s business climate still isn’t right. Gov. Gregoire said “we did all we could” to keep the 787 work. I respectfully disagree. For too long, state government has added policies and regulations that are hostile to employers and job creation, while ignoring Boeing’s warning signs.
Consider this:
• Washington has the highest minimum wage in the nation.
• Washington’s unemployment insurance tax rates are the second highest in the nation.
• Washington has the fifth highest unemployment insurance benefits in the nation.
• Washington is one of only four states with a workers’ compensation insurance system that is a state-run monopoly. Although claims are down, employers and employees are paying more, and the state is proposing an additional 7.6 percent rate hike.
• Washington has among the highest gas taxes in the nation, yet we’ve made little progress in reducing traffic congestion.
• Our state has among the highest business taxes of the western states.
• The governor is willing to consider tax increases in the 2010 legislative session.
• The governor and the Legislature’s majority party are pushing for climate-change legislation that would impose millions of dollars on employers.
Remember, this isn’t just about Boeing. Hundreds of suppliers, including Janicki Industries in Sedro-Woolley, rely on Boeing to support their companies. They and thousands of other employers in Washington struggle every day with the challenges mentioned above and still somehow manage miraculously to survive. I’m concerned that unless the Legislature addresses these challenges, other home-grown employers may follow in Boeing’s footsteps to more competitive states that have laid out the welcome mat for them.
My House Republican colleagues and I are preparing an employer and jobs package of legislation to be ready for the 2010 session in January. Many of our ideas in this package have been on the table for years. It’s just that the majority party has been unwilling to act upon them. Hopefully, the Boeing decision will serve to change that. The Legislature can no longer afford to pretend there’s no problem. Washington must act now to create a more competitive business climate before we lose more employers to other states.
Washington’s employers are changing the way they do business. They are re-thinking ways of becoming more competitive to survive, grow and remain successful. Washington must do the same and do it now. We owe it to all families who earn a paycheck and to all who conduct business in our state.
State Rep. Dan Kristiansen, R-Snohomish, represents the 39th Legislative District, and also serves as chairman of the Washington House Republican Caucus. He can be contacted at 360-786-7967 or e-mail him and sign up for his e-newsletter at: www.houserepublicans.wa.gov/Kristiansen.
