The PEOTUS’s Game of Chess
Chief among the overlooked-yet-critical facts in this week’s saga over Boeing’s uncertain future production of Air Force One planes: The Chicago-based corporation is the only U.S. company with a product to match White House requirements for presidential needs and safety.
Boeing’s top competitors are headquartered overseas. The only one currently capable of producing a quality four-engine jet to rival Boeing’s 747–8 is the France-based Airbus. And for that reason, the Air Force transparently said in January 2015 it waived the bidding process and awarded an early stage of the contract to the one company that could claim the president’s plane would be wholly made in America.
In other words, Boeing had zero competition in landing among the most prestigious of U.S. government contracts and billions in revenue. So when President-elect Trump said at Trump Tower Tuesday, “I think Boeing is doing a little bit of a number. We want Boeing to make a lot of money, but not that much money,” he likely was suggesting that Boeing is jacking up costs because it can.
When he encouraged his crowds toward the end of the election to chant, “drain the swamp,” this is part of what he meant. It’s clear that he’s skeptical of government contracts and views them as a tool in his negotiation arsenal.
The problem for Trump is that in cases like this one, two of his key objectives are in direct conflict: draining the swamp and keeping good jobs in the United States.
He successfully strong-armed Carrier last week into keeping jobs in Indiana by, in part, reportedly dangling government contracts before its parent company (or threatening to withdraw them). Yet should Boeing lose the ultimate contract to Airbus to build the planes after an open competition, France might score some jobs that the United States otherwise would have had.
Enter the art of the deal.
Note that in his comment about Boeing’s “number,” he did concede he wants Boeing to make a lot of money. In the evergreen quest to pinpoint whether Trump is shooting from the hip or shrewdly laying down a marker, the concession to Boeing is a point for the latter.
The tweet that initially set off the scramble was on Tuesday morning when Trump complained that one of the projected costs to the federal government for the two new planes could tick up to $4 billion. So he decreed, “cancel order!”
But eventually, Air Force One planes will be out of date and new ones will have to be built. And it may still be that Boeing has to build them.
Boeing CEO Dennis Muilenberg did question anti-trade political rhetoric in a Chicago speech on Friday that surfaced most visibly in a Chicago Tribune piece Tuesday morning, prompting critics to surmise that Trump’s tweet was a reckless warning shot. They suggested he was trying to coerce the company to pipe down in a way that caused immediate financial damage to the highly profitable Boeing and its employees.
Trump’s spokesman Jason Miller’s spin pointed to government spending, saying the president-elect is committed to reducing it.
Both sides may be absolutely right.
Cheer him or fear him, Trump already is forcing the United States to undergo a fascinating study in what it means to have a business leader as president before even having taken office. And it undoubtedly will change the way the business of Washington works.
And one more thing: It’s almost 2017. Technology is advancing at a rapid clip. Should Trump delay this contract, could more competition to Boeing arise? So many levels to this story…