The Machinists union is calling for an investigation into what it calls a “growing practice” by the Gulf Coast states in using federal disaster relief funds to try to woo manufacturers to their states.
Machinists international president Tom Buffenbarger sent a letter this week to U.S. Attorney General Eric Holder asking for an investigation into Louisiana’s $400 million offer to Hawker Beechcraft to move its operations to Baton Rouge.
“The IAM believes your office should be concerned with where Louisiana got $400 million to game our economy in this way,” Buffenbarger said in the letter.
It seems clear that the state is using federal development assistance including “supplemental Katrina” funds, he wrote.
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“Louisiana is one of the poorest states in the Union, still suffering the devastating consequences of Katrina and other hurricanes,” the letter said. “It could not come up with nearly half a billion dollars on its own.”
The Machinists union alleges that “Louisiana’s gambit violates the law.”
Buffenbarger noted that an Aerospace Alliance formed in October 2009 by Louisiana, Alabama and Mississippi governors was formed to bring aerospace manufacturing jobs to their states.
Local development corporations advertised the development of aerospace parks for new facilities, public infrastructure to support them “and whatever else would be needed for a company to move — including federal money, specifically touting special federal Katrina funds authorized by the Gulf Opportunity Zone Act of 2005,” the letter said.
Interstate raiding of jobs drags down the national economy, because moving jobs between states does nothing for national employment, Buffenbarger wrote. It’s not an activity that taxpayers should subsidize, he said.