Aviation

Politically, Hawker deal might have been harder next year

Cutting the deal to keep Hawker Beechcraft in Wichita might have been more difficult next month when more fiscally conservative Republicans will be installed at the Statehouse, political observers said Tuesday.

Ken Ciboski, a professor of political science at Wichita State University, said he thinks it was probably a lot easier to strike the $45 million deal in the final days of Democratic Gov. Mark Parkinson's administration.

Early next month, leadership of the state swings to Republican Gov.-elect Sam Brownback and a Legislature that will welcome many new members with roots in the free-market conservative and tea party movements.

"I think there would have been a lot of pressure put on Sam Brownback" to resist public subsidies, Ciboski said.

He said it would have forced free-market conservatives into a dilemma of using government money to keep 4,000 jobs in Wichita, or staying true to the anti-bailout ideology that vaulted the GOP to big gains in the November election.

Hawker Beechcraft "is an important component of employment for this community," Ciboski said. "Those people who are opposed to public-private partnerships... I think they're going to have to come to terms with this, deciding whether that outweighs their perspective of having a negative view" of government involvement in business.

In announcing the deal, Parkinson, a former state Republican chairman, pointedly said, "it is not a huge bailout."

In an interview with The Eagle in Topeka, Brownback said he is pleased that a deal had been reached.

"This has been an extensive negotiation... and this is a critical factor in us keeping the aviation industry in the state of Kansas," he said.

But he added that he thinks the package is "probably as far as the state can go."

"In fact, I'm not sure we have ever given incentives for a company to stay," Brownback said. "We've given incentives to recruit companies into the state, but I think this is the first time we've given incentives for a company to stay."

Had it not happened now, the deal would probably have encountered more opposition, said Derrick Sontag, state director of Americans for Prosperity, a group that advocates for free markets and against government involvement in business.

"I think there would have been more serious discussion about what's best to do," he said. "There are a number of incoming legislators who have concerns about these types of decisions."

He said Hawker Beechcraft is a tough call.

He said it's good that Kansas won't lose Hawker Beechcraft's jobs to another state, but the underlying problem is that states continue to compete to offer incentives to lure away one another's businesses.

Hawker Beechcraft was wooed by Louisiana and other states that company CEO Bill Boisture declined to name.

The problem Kansas will have to grapple with now is, "which company is next?" Sontag said.

Now that Hawker Beechcraft has gotten an incentive to stay here, he said it's only a matter of time before other major employers seek similar concessions to agree not to move.

He said his group is also worried about the potential effects that subsidizing big business can have on smaller competitors.

"The mom-and-pop shops, they're not getting a bailout at the end of this year and they're not going to," he said.

Sontag said the long-term answer is to restructure tax codes so businesses won't have an incentive to seek incentives elsewhere.

Similar sentiments were expressed by Mike Pompeo, who will take office as Wichita's congressional representative in January.

In a statement, he said he's pleased that Hawker Beechcraft is staying and called the decision "a testament to the incredibly capable aviation workforce here in south-central Kansas."

But, he added, "The agreement involving local and state government incentives will only provide a temporary answer. The real solution to protect the future of aviation jobs in Wichita is a strong economy with smaller government and less federal regulation."

Bob Beatty, a professor of political science at Washburn University in Topeka, likened the local situation to the spending debate in Congress — with representatives who "rail against wasteful spending but will still go after earmarks" for their own district.

He said he expects more government money to flow from the state to business coffers in the coming years, but it will likely be in the form of tax cuts rather than cash.

"Obviously tax cuts are a lot easier because they aren't seen as government spending," Beatty said. "There's a lot more wiggle room even if the end result is the same."

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