The banns have been published, the happy couple has plighted its troth, but before Bath Iron Works and Ingalls Shipbuilding get too connubial about this new Navy destroyer deal, Maine taxpayers just might have a few questions before they forever hold their peace and shell out $60 million for a wedding present.
Such as: If the $3 million per year for 20 years tax break enacted last spring was necessary for BIW to compete with arch-rival Ingalls, is it necessary now that they’re on the same side? Or: Can Sen. Trent Lott of Mississippi, whose love for homestate Ingalls is exceeded only by his dislike for BIW, be trusted? Or: Does the new prospect of 16 new ships over the next 17 years mean BIW can keep its workforce at the current 7,300, or is Maine still paying $60 million to lose a couple of thousand jobs?
Or: Does General Dynamics Corp, which became BIW’s parent two years ago amid great trumpeting about its vast financial resources and then came back this year for a handout, think Mainers are extraordinarily generous or just chumps?
OK, this teaming up (both companies are careful to call it an alliance to preserve the impression they’re still competitors) is welcome news in that it could help ensure the survival of Maine’s largest employer for the next two decades. Still, one can’t help but wonder why life with General Dynamics — one of the nation’s largest defense contractors, a huge corporation one would assume plans way, way ahead — is so full of surprises.
The tax break itself came up suddenly, in the last weeks of the legislative session, and General Dynamic’s message was blunt: pay up or we ship out. Just weeks after harried, pressured lawmakers complied, industry observers reported that GD and Litton Industries, Ingall’s enormous parent, were talking merger. Those reports were discredited, but now it appears maybe the observers merely mistook alliance negotiations for merger negotiations. Those careless, irresponsible observers.
The numbers at work here never made much sense, given that the BIW modernization is a $300 million project and that the Aegis destroyers now built there go for $300 million. Maine’s paltry $3 million a year just never seemed to many legislators and a lot of citizens like a deal-breaker. This new breed of super-duper destroyer most likely will cost much more, what with the inflationary pressures on military toilet seats and hammers, making Maine’s stake even more paltry. Anyone who felt General Dynamics demanded the tax break not because it needed it but because it could get it is likely to feel more so now.
It’s unknown whether this tryst will produce offspring — at least two other shipyards are competing against this BIW-Ingalls combo for these 32 destroyers. Here’s another query: If the newlyweds get the contract, should not Litton (instead of Maine taxpayers) help General Dynamics upgrade BIW, since it will be a beneficiary of the modernization?
BIW has been a valued Maine employer for more than a century and undoubtably Mississippians feel they same way about Ingalls. They’re great kids. It’s the parents that make us crazy.
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