Aerospace profits soar as workers are cut
By Heather Cottin
War is good for the economy if you are a capitalist. If you
are a worker, you face unemployment. The annual report by the
Aerospace Industries Association (AIA) on Dec. 8 shows that
aerospace employment is at its lowest level in 50 years.
But profits are booming--at their highest levels in 85
years. Total sales this year surged by $12 billion to $161
billion, with profits running to $10.1 billion. (Seattle Post
Intelligencer, Dec. 9) Virtually all this growth is in military
orders.
The industry is salivating at the prospect that sales will
increase even more in 2005. AIA analysts predict a 7.5-percent
increase to $173 billion, with most of that growth coming from
military sales and demand for missiles and other weapon
systems.
As the war in Iraq deepens and U.S. military adventurism
burgeons from Latin America to Africa, Europe to the Middle
East and Asia, the aerospace and "defense" industries are
raking in the contracts. Military aircraft sales increased 15
percent, and missile sales jumped 10 percent, the AIA report
said.
Meanwhile, the number of aerospace and defense industry jobs
has declined just as rapidly as jobs in all industrial sectors.
The mantra of "free trade" is echoed throughout the military
industry. Cheaper labor means bigger profits. The U.S. defense
industry now outsources at least 50 percent of its work,
meaning many jobs not automated are going abroad. (American
Economic Alert, Oct. 8, 2003) Deputy Defense Secretary Paul
Wolfowitz in 2003 personally engineered a deal allowing the
defense industry to drop the requirement that military
production be done with U.S.-made machine tools.
Aerospace sales to the Pentagon are expected to rise 7
percent to $76 billion next year from $71 billion this year,
and financing for research and development will approach $80
billion.
"This is the second-best year in the industry both for
absolute profits and for profits as a percentage of sales," AIA
President and CEO John Douglass said. AIA is an influential
trade group representing the heavyweights in aerospace,
including Boeing, Lockheed Martin, Northrop Grumman, General
Dynamics and Raytheon.
On Long Island, in California, in Washington State and other
regions of the United States, workers who counted on the
military industry to generate jobs are out of luck. Local
economies are stagnating or worse, and corporate moguls have
left the workers behind. It is just like the auto industry,
just like the steel industry. The old factories are empty, and
only Wal-Mart is hiring.
The war in Iraq has already cost $150 billion.
(costofwar.com) Much of that has gone to profit an industry
"headed in the right direction," according to Douglass. This
industry is generating few jobs but many weapons of mass
destruction, the death of tens of thousands, and at least one
major scandal--a corrupt $23-billion deal between the Air Force
and Boeing.
The Air Force's former top weapons buyer, Darleen Druyun,
faces a 9-month prison term. Michael Sears, Boeing's former
chief financial officer, has pleaded guilty in federal court to
conflict of interest charges. Air Force Secretary James Roche
and other administration officials remain under
investigation.
Still Douglass crows, "This industry is one of the very
brightest spots in the American economy."
Bright for those profiting from death, not for workers. Not
for soldiers either. With all the billions poured into military
industry coffers, U.S. soldiers in Iraq are prodigiously poorly
protected. It's not profitable to protect the cannon fodder, it
is only profitable to build expensive weapons systems.
Reprinted from the Dec. 23, 2004, issue of
Workers World newspaper
This article is copyright under a Creative
Commons License.
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