This spring’s news that Boeing, a corporate weapon manufacturer, will be moving its headquarters from Chicago, Illinois is a victory for the anti-militarist movement. It comes just weeks after a more significant victory for youth organizers, who prevented the company from receiving a $2 million tax cut before they left.
It’s a victory that organizers like us hope will inspire communities in other cities to target weapons manufacturers who are sucking up public resources via tax breaks and government contracts. Our movement can stop the business model that plunders public funds to make profit from militarized weaponry by forcing local governments to ask questions and not just write blank checks.
This victory came months after a group of young people blocked traffic to and from Boeing’s corporate headquarters last May, hanging a large banner that read “Boeing Arms Genocide” over the Chicago River that was visible from the corporate offices and commercial walkways in the city’s downtown area. Following escalated assaults on the Palestinian neighborhood of Sheikh Jarrah, which sparked protests around the world, these youth called attention to Boeing’s $735 millionThe United States State Department approved the sale of weapons to Israel in the same week as the attack.
In the months to come, organizers will be able to use the newly formed Boeing Arms Genocide campaign presented to Chicago’s Office of Inspector General (OIG) and to Alderwoman Maria Hadden with a detailed analysis of how Boeing’s Chicago headquarters has reaped more than $60 million in tax breaks while failing to deliver on promises of job creation. (Alderwoman Hadden represents Chicago’s 49th ward, which is home to large immigrant and refugee communities.) This set off an OIG inquiry into this contract, which made it possible. Boeing refused to file for tax reimbursement in the amount of $2 million for the first time since 20 years. The company’s leaders then announced in May 2022 that their headquarters would be moving to another city.
From the onset of the campaign, organizers had set out to ensure there would be no extension of the contract slated to end in 2021, or any new contract that would allow Boeing to continue benefiting from state and local tax breaks, after they’d received these public checks for two decades. The canvassing, petition drives, teach-ins and meetings with city officials resulted in first-time scrutiny on the company’s compliance with the minimal requirements of the contract. A Freedom of Information Act request confirmed, in the words of the Department of Planning and Development’s Financial Incentives Division Deputy Commissioner Tim Jeffries, “The term of the agreement is over and Boeing has stated they are not seeking reimbursement for the 2021 tax year. The contract is functionally dead.”
It might seem small to put up a fight against a Fortune 500 firm. But a few banners painted by hand and some public pressure along with the compelling research of a group 20-somethings presented before a few city officials could make a big difference. However, a closer look at Boeing’s business model reveals how much they stand to lose if they are challenged on the idea that public funds can or should be used to support the profits of a weapons manufacturer.
Bush-Era Laws Open the Door to Corporate Exploitation
Making commercial airplanes, what Boeing is most commonly known for, accounts for less than 30 percent of the company’s annual revenue. Boeing is primarily in business of making money from war and militarism. Not airplanes. As the world’s third-largest profiter of weapons sales, the company rakes in billions in profit from arming the war on Yemen, Israel’s occupation of Palestine, and India’s ethnic cleansing of Kashmir.
Fifty-five percent of Boeing’s profits come from weapons sales, amounting to more than $32 billion in 2020, to the U.S. government as well as 21 other countries around the globe. Boeing was donated by U.S. taxpayers $21.33 billionThrough government contracts in 2020 alone. Chicago’s tax breaks for Boeing happened in the context of the company already reaping huge profit from public resources via U.S. government spending on things like military weapons, border surveillance and the creation of missile systems.
Boeing is involved in selling weapons to governments to be used for war and state violence. This case highlighted the problem with corporate tax incentives, which became a challenge for the entire war profiteer business model and a challenge against the idea that the public should subsidize militarism.
Twenty years ago, Boeing’s move to Chicago was on the early edge of what has become a pattern of corporations relocating to places where they stand to benefit from tax incentives and mega-deals. Local governments compete to offer the best deals to the companies. These deals are often the worst for the public in terms dollar-for-dollar outcomes.
This pattern was then codified and accelerated by President George W. Bush signing the “Job Creation & Worker Assistance Act” into law just months laterIn March 2002. This piece of legislation allowed corporations to pocket $300 billion over 10 year. It was a corporate tax cut branded as a way for ordinary people to have jobs. This narrative about corporations paying fewer taxes is rooted in the free market idea that relieving the “burden” of things like regulation and taxation allows corporations and the market to create economic growth, jobs and prosperity. We see that corporations are driven primarily by profit. This is achieved via exploitation of our natural environment and, in this case public funds.
Then known as a Seattle-based company that makes airplanes, Boeing’s move in late 2001 exemplified a desire to separate their executives from their weapons manufacturing hubs and establish proximity to more global business leaders in a “world-class” city. Boeing would receive tax reimbursement checks each year from the City of Chicago in return for housing its headquarters in a downtown skyscraper. In addition to additional tax breaks, the state would also provide tax relief. Boeing has achieved a remarkablely low standard, despite this. repeatedly fell short and is now leaving the city after having taken in tens of millions of public dollars without consequence for its failure to deliver for Chicagoans or for the harm the company’s weapons have caused around the world.
Corporate tax incentives benefit executives, not residents or workers
Corporations that are lured to cities or states by tax incentives often under-deliver. They are often not held accountable for their actions in providing jobs and economic growth in return for tax cuts. In 2017, the then-Governor of Wisconsin was. Scott Walker brokered one of the biggest corporate tax incentive deals ever approved. Foxconn, an electronics company, was eligible for more than $4 billion in tax incentives from state and local governments. The incentive was based upon the construction of a huge new factory that would provide 13,000 jobs.
Two years after the original agreement was made, plans to build a huge factory were canceled and only 178 jobs had been created. By 2021, the proposed factory and corresponding deal that former President Donald Trump lauded as being the “eighth wonder of the world” had shrunk dramatically in scope, and the contract was renegotiated after Governor Walker left office. Foxconn failed to deliver on its visions of thousands more jobs from a large factory campus, despite receiving more than a billion dollars in forgone investment.
Despite the public narrative pushed by right-wingers, centrist Democrats and corporate elites — a narrative claiming that relieving taxes on corporations creates economic growth — those who stand to benefit most from these types of deals are high-level corporate executives, not workers or local residents. A recent study analyzing the effects of two specific corporate tax breaks showed that for every dollar a company benefits from certain tax breaks, the pay of the company’s top five executives increased by 17 percent to 25 percent.
There is no evidence to support the notion that tax breaks lead to higher wages and better jobs for workers. And a report published by the Action Center on Race and the Economy showed that in the case of Boeing specifically, “The creation of additional jobs and income as spending from the Boeing headquarters rippled through the economy was not significant.” This is despite the city and state giving $63 million in tax incentives to bring 500 jobs, which equate to about $126,000 per job per year financed by the city, most of which already existed before the move.
Imagine those funds invested in the public sector, in high-paying union jobs, dedicated to the programs and services that working communities are constantly seeking such as health care, education and needed social programs — we could create real jobs programs instead of lining the pockets of executives such as Boeing CEO David Calhoun, who recently bought a $2.7 million condominiumDowntown Chicago
Whether it’s Boeing leaving when tax incentives dry up, Foxconn abandoning its promised factory, or Amazon never coming when it promised cities billions of dollars, these companies have shown that they’ll come when there’s financial incentive and leave when there’s not.
Chicago’s marginalized communities have had to fight ongoing divestment and demand funding for basic needs for decades. Parents and community members went on hunger strike for 34 days demanding the city reopen Dyett High School, one of the almost 50 schools serving predominantly Black students closed under former Mayor Rahm Emanuel in 2013 — partially on the basis of budget constraints.
In 2012, the City of Chicago fired 172 librarians and shortened library hours to save the city $3 million. The city also paid $1.3 million to Boeing for real estate tax reimbursements. The city shut down half of its 12 public mental healthcare clinics in 2012 to save $2.2million. Patients, workers, and members of the community fought hard to keep them open. They also staged occupations, engaged in civil disobedience, and organized a wide community-based coalition. Boeing was given a $1.3million check by the city to pay back the real estate taxes they had already paid.
A couple million dollars might seem like an insignificant amount for a company making tens of trillions per year. But those resources can save lives for communities in dire need of a school, a clinic, or resources or jobs.
While city officials mock communities that are fighting for crucial investments, they are grateful for the mere existence of multinational corporations. In the same FOIA that confirmed the end of the Chicago contract, City Financial Analyst Patrick Lynch, who was assigned to administering the Boeing contract, replied on the email thread confirming that Boeing would not receive its final tax reimbursement with, “boeing doing us a solid.”
What Lynch was referring to as “a solid” was Boeing’s choice to decline to file for its final $2 million tax reimbursement after years of getting a tax break despite being in likely breach of contract, and reaping billions in profit while Chicago’s marginalized communities have seen the closures of schools, clinics, libraries and more. This attitude is a reflection on a confused set of priorities held city officials, who are unsure who public resources belong, and unwilling to actually question predatory corporate relationships.
Let’s Divert Resources From Militarized Violence to Community Investment
Boeing not only takes resources away from other public goods and services, but also makes a profit from the production and sale deadly weapons that are used in the waging of militarized violence all over the globe. In 2021, Boeing generated more than $62.29 billion in revenues.
It is fighter jets and helicoptersthey were used in an attack that killed 256 Palestinians in MayLast year. In the Saudi-led war on YemenGuided missiles are the single most deadly weapon for civilian casualties. Boeing had sold more than 6,000 guided weapons to Saudi Arabia by 2019. Boeing weapons guidance kits were used to ensure that the missile struck its target in the 2016 bombing of Mastaba, a Yemeni village, killing 97 people, including 25 children.
Boeing doesn’t limit its use of militarized technologies to violence abroad, however. Boeing was heavily involved in the lucrative business to militarize the U.S.-Mexico border and held 17 contracts. worth $1.4 billionBetween 2006 and 2019, a collaboration was made between U.S. Customs and Border Protection and Boeing. In 2007, Boeing began a dystopic collaboration with ShotSpotter, a faulty, racist, “gun-detection” technology that has been linked to police-perpetrated murders in major cities across the U.S. as a result of a propensity to falsely indicate gunshots and locations only in Black and Brown neighborhoods. Boeing and ShotSpotter collaborated in 2007 by attaching ShotSpotter’s microphones to Boeing’s drones, with the intention of using them in the skies in Iraq.
A Black-led movement, a decade of organizing around police divesting to invest in Chicago’s community resources and the country has set the scene for a campaign against Boeing: campaigns such as No Cop Academy, which fought the construction of a multimillion-dollar police academy in Chicago; the campaign in Durham, North Carolina that won the creation of a city-funded community led Safety & Wellness Taskforce as an alternative to hiring more police officers; and the hundreds of defund police campaigns organized since the uprisings in 2020. Although not all of these campaigns have been successful, they all contributed to a movement that forced a reckoning about public safety and increased scrutiny of city budgets and the allocation of public resources.
A reenergized antiwar movement would be well advised to learn from the visionary work done by police and prison abolitionists. This includes finding more local contracts and ties to interrogate, while condemning the violence of wars as well as the profiteering of weapon manufacturers. There is a direct correlation between elected representatives choosing to give tax breaks for companies that make weapons and investing in police instead of the programs and services that local communities need. Cities are contributing to the destabilization of communities around the globe by prioritizing investments in militarization, police, and corporate interests for the sakes of profit.
Boeing continues to make billions by selling weapons and companies like it. However, there are opportunities for more communities to organize and resist the use of public funds to fund war profiteers, rather than to the public good. Although Boeing’s decision to leave Chicago and move its headquarters to Virginia is not a win in itself, it will certainly prevent the company from losing its last paycheck from Chicago and setting a precedent. As more local groups calling out Boeing appear in cities across the country, including the Washington, D.C., Seattle, and St. Louis areas, the company should expect and deserve heat wherever it goes.
Everyday people have the power to stop public dollars being funneled to weapons-makers in any city, just as the young Black and Brown activists in Chicago resisting Boeing. To use that power to make an effect, we must be organized. It requires us to build social movements that connect issues like militarized aggression and corporate greed to give a more complete picture of what is wrong and what is possible.
Stimulus checks, a moratorium for student debt repayment and a mass movement calling to defund the police in the context the pandemic have opened up a public conversation about how public funds are used. So let us use this as an opportunity to open our political imaginations of what’s possible, and to organize for an expansive vision of how public resources can be put toward our collective benefit.
