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BOEING’s executives rake $billions from tax-payers to spread weapons around the world

Taxpayers within the U.S. gave Boeing $21.33 billion through government contracts in 2020 alone.

While companies like Boeing continue to rake in billions from producing and selling weapons, there is a pathway for more communities to organize, to resist public dollars lining the pockets of war profiteers instead of going toward the public good.

”……………………………………………………………………Bush-Era Legislation Paves the Way for Corporate Exploitation,

Making commercial airplanes, what Boeing is most commonly known for, accounts for less than 30 percent of the company’s annual revenue. Boeing is primarily in the business of profiting from war and militarism, not airplanes. As the world’s third-largest profiter of weapons sales, the company rakes in billions in profit from arming the war on Yemen, Israel’s occupation of Palestine, and India’s ethnic cleansing of Kashmir.

Fifty-five percent of Boeing’s profits come from weapons sales, amounting to more than $32 billion in 2020, to both the U.S. government and 21 countries around the world. Taxpayers within the U.S. gave Boeing $21.33 billion through government contracts in 2020 alone. Chicago’s tax breaks for Boeing happened in the context of the company already reaping huge profit from public resources via U.S. government spending on things like military weapons, border surveillance and the creation of missile systems.

Boeing is in the business of selling weapons to governments that are used to wage war and enact state violence. In this case, a challenge to corporate tax incentives became a challenge to the whole business model of a war profiteer and a challenge to the idea that the public funds can or should subsidize militarism and profit.

Twenty years ago, Boeing’s move to Chicago was on the early edge of what has become a pattern of corporations relocating to places where they stand to benefit from tax incentives and mega-deals. Local governments compete to offer the best deals for the companies, which are often the worst deals for the public in terms of dollar-for-dollar outcomes.

This pattern was then codified and accelerated by President George W. Bush signing the “Job Creation & Worker Assistance Act” into law just months later in March 2002. Making way for corporations to pocket $300 billion over 10 years, this piece of legislation was a corporate tax break branded as a way to create jobs for everyday people. This narrative about corporations paying fewer taxes is rooted in the free market idea that relieving the “burden” of things like regulation and taxation allows corporations and the market to create economic growth, jobs and prosperity. However, what we see to actually be true is that corporations are driven by profit, something that is maximized via exploitation and extraction from our natural environment or, in this case, from public funds.

Then known as a Seattle-based company that makes airplanes, Boeing’s move in late 2001 exemplified a desire to separate their executives from their weapons manufacturing hubs and establish proximity to more global business leaders in a “world-class” city. In exchange for housing its headquarters in a downtown skyscraper and promising to maintain only 500 jobs to the city, Boeing would receive annual tax reimbursement checks from the City of Chicago, in addition to further tax breaks from the state. Even with an impressively low bar, Boeing repeatedly fell short and is now leaving the city after having taken in tens of millions of public dollars without consequence for its failure to deliver for Chicagoans or for the harm the company’s weapons have caused around the world.

Corporate Tax Incentives Benefit Executives, Not Residents or Workers

Corporations lured to cities and states by tax incentives consistently under-deliver and often are not held to whether they hold up their end of the bargain when it comes to providing jobs and economic growth in exchange for tax cuts. In 2017, then-Wisconsin Gov. Scott Walker brokered what was one of the largest corporate tax incentive deals ever approved. Electronics company Foxconn would receive more than $4 billion in state and local tax incentives on the premise of building a massive new factory that was to create 13,000 jobs.

Two years after the original deal was reached, plans for building a massive factory had been scaled back, and only 178 jobs were created. By 2021, the proposed factory and corresponding deal that former President Donald Trump lauded as being the “eighth wonder of the world” had shrunk dramatically in scope, and the contract was renegotiated after Governor Walker left office. Foxconn never delivered on visions of thousands of jobs created by a huge factory campus despite benefiting from more than a billion public dollars in forgone investment.

Despite the public narrative pushed by right-wingers, centrist Democrats and corporate elites — a narrative claiming that relieving taxes on corporations creates economic growth — those who stand to benefit most from these types of deals are high-level corporate executives, not workers or local residents. A recent study analyzing the effects of two specific corporate tax breaks showed that for every dollar a company benefits from certain tax breaks, the pay of the company’s top five executives increased by 17 percent to 25 percent.

Evidence does not support the idea that tax breaks actually result in higher wages or better jobs for workers. And a report published by the Action Center on Race and the Economy showed that in the case of Boeing specifically, “The creation of additional jobs and income as spending from the Boeing headquarters rippled through the economy was not significant.” This is despite the city and state giving $63 million in tax incentives to bring 500 jobs, which equate to about $126,000 per job per year financed by the city, most of which already existed before the move.

Imagine those funds invested in the public sector, in high-paying union jobs, dedicated to the programs and services that working communities are constantly seeking such as health care, education and needed social programs — we could create real jobs programs instead of lining the pockets of executives such as Boeing CEO David Calhoun, who recently bought a $2.7 million condominium in downtown Chicago………………………………….

Let’s Divert Resources From Militarized Violence to Community Investment

Not only does Boeing take resources away from other needed public goods and services by pulling in tax breaks and government contracts, it also profits from the production and sale of deadly weapons used to wage militarized violence around the world. Boeing earned over $62.29 billion in revenue in 2021.

Its fighter jets and helicopters were used in an attack that killed 256 Palestinians in May of last year. In the Saudi-led war on Yemen, the single largest weapon killing civilians has been guided missiles, of which Boeing had sold Saudi Arabia more than 6,000 guided bombs by 2019. In the 2016 bombing of a market in the Yemeni village of Mastaba, which killed 97 people (including 25 children), destroyed infrastructure and left massive destruction, Boeing weapons guidance kits were used to ensure the missile hit its target.

Boeing doesn’t limit its use of militarized technologies to violence abroad, however. Boeing is heavily involved in the lucrative business of militarizing the U.S.-Mexico border……………………………………..

While companies like Boeing continue to rake in billions from producing and selling weapons, there is a pathway for more communities to organize, to resist public dollars lining the pockets of war profiteers instead of going toward the public good. While Boeing leaving Chicago and taking its headquarters to Virginia may not be a standalone win, blocking the company from its last paycheck from the city and the precedent it sets certainly is. As local groups calling out Boeing emerge in more and more cities across the country, from the Washington, D.C., area to Seattle to St. Louis the company should expect and deserves heat wherever it goes.

Everyday people, like the young Black and Brown organizers resisting Boeing in Chicago, have the power to make it no longer politically acceptable to funnel public dollars toward the profits of a weapons-maker in any city. Wielding that power to make an impact requires us to be organized. It requires us to grow social movements that connect the dots between issues like militarized violence and corporate greed in order to paint a fuller picture of both what is wrong in the world and what is possible…………………

July 16, 2022 - Posted by | business and costs, USA, weapons and war

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