President Obama addressed several hundred Boeing 787 workers at the Everett widebody jet plant Friday morning, touting his efforts to protect American manufacturing jobs through proposed tax-policy changes as well as new measures to boost U.S. sales via the federal Export-Import Bank.
President Obama addressed several hundred Boeing 787 workers at the Everett widebody jet plant Friday morning after a tour of the Dreamliner production line.
He delivered a stump speech touting his efforts to protect American manufacturing jobs through proposed tax-policy changes as well as new measures to boost U.S. sales via the federal Export-Import Bank.
The president made his entrance to the crowd coming down the steps of the first United 787 at the end of the Dreamliner production line.
He said the outsourcing of manufacturing jobs has been “incredibly painful for a lot of families and communities” and conceded that due to productivity improvements and automation “a lot of those jobs aren’t coming back.”
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He proposed to push in Congress changes to federal tax policy that will take away tax breaks for companies that move work overseas and correspondingly reduce taxes for those that keep work here.
Despite Boeing’s record of foreign outsourcing in the last decade, the president gave the company full credit for its more recent recognition of the value of its U.S. workforce.
“If you’re a business that wants to outsource jobs, that’s your choice. But you shouldn’t get a tax deduction for doing it,” he said. “That money should be used to cover moving expenses for companies, like Boeing, that decide to bring jobs home.”
He added, “It’s time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America. This Congress should send me these tax reforms and I will sign them right away.”
In addition, Obama announced moves to strengthen the powers of the Ex-Im Bank, which finances Boeing’s international sales. Fred Hochberg, chairman of the Ex-Im Bank, accompanied the president on the trip.
Obama cited Ex-Im financing support for Boeing’s sale of 230 jets to Lion Air of Indonesia, finalized just last week.
“That was one of the biggest deals Boeing had ever done,” he said.
He also announced that he is “instructing the Bank to give American companies a fair shot by matching the unfair export financing that their competitors receive from other countries.”
While the president didn’t give further detail in his address, supporting materials released by the White House suggest that Boeing could be a significant beneficiary of this move.
Those materials said that the Ex-Im Bank would offer support for “domestic or third-country sales with matching financing support to counter foreign non-competitive official financing that fails to observe international disciplines.”
Expanding the authority of the Ex-Im Bank to finance domestic sales would mean it could support Boeing with financing for jets sold to U.S. carriers in competition with Bombardier, which is offering its CSeries aircraft with Canadian government financing support.
Financing domestic sales would be a new departure that could not only help Boeing but also U.S. airlines. But it seems likely that this is a tool that will be used only if Canada pursues its intention to offer financing.
Boeing spokesman John Kvasnosky said after the speech that “it’s a new initiative and we’ll have to study it to understand the implications.”
What’s clear is it’s a tool that the U.S. government now has ready if it needs to use it, for example in the sales campaign to sell single-aisle jets to United Airlines, where Boeing, Airbus and Bombardier have all offered their jets.
Dominic Gates: 206-464-2963 or email@example.com