“WE WERE in a battle for this expansion . . .” That was Governor MikeBeebe celebrating Dassault Falcon’s decision to expand its already sizable stake in its Little Rock plant rather than choose another location for it. The competition was considerable, but Arkansas won the battle. It was important that we did because, as Congressman Tim Griffin said at the same news conference, “These are the sort of jobs that we want more of.”
He was talking about good-paying jobs like outfitting aircraft made in France and finished up here in Arkansas. The bidding war for the new facility was another demonstration that this state is no longer almost solely dependent on farming. Arkansas has developed a manufacturing base, too. Enough of one to attract savvy foreign investors like Dassault Falcon, which may still be headquartered in Paris (the one in France) but has long since become a worldwide operation. And its latest investment is welcome in the middle of Arkansas and the middle of America.
Congratulations on this new addition are due a lot of people:
First to Dassault, which recognizes an opportunity and a pool of skilled workers who are as passionate and conscientious about their craft as Dassault is about its aircraft.
Second, congratulations to those workers, who are the main reason there will be more like them here in Arkansas. Their jobs are made only more secure by this decision at corporate headquarters. Because if Dassault hadn’t chosen Little Rock in this national competition for its expansion, those jobs might soon enough have been shifted elsewhere.
Third, thank you, Arkansas taxpayers. You made a host of economic incentives available to these investors. Just for starters, Dassault is to get a cash rebate of 3.9 percent of the payroll for some 420 of its jobs over the next 10 years-that’s the estimated number of jobs that will be saved at the plant in order to work on the new model jet the company is introducing next fall.
It all amounts to a $7-million tax break if the number of jobs saved holds steady, and even more if it goes up. (Dassault already employs 2,000 people at Little Rock’s airport.) Then there are the other multiple tax breaks the state provides new investors-and old ones who increase their investment.
Little Rock’s own municipal aircraft commission provided a package of incentives totaling some $43 million over the next 10 years-incentives like breaks on Dassault’s rent at the airport. So thank you, local taxpayers. The $60-million, 250,000-square-foot expansion of its Little Rock plant is just one sign of Dassault’s growing footprint at the airport.
Dassault’s decision to invest in Arkansas, and in America, is certainly understandable as Europe’s sclerotic economy continues to stagnate-a sad result of the usual misguided policies: ever higher taxes and ever more government spending, a vast and vague network of sacrosanct subsidies for both labor and capital. And ever more over-regulation in general. Not to mention a currency that ignores national differences and reality in general. Which is another reason Europe’s southern and poorer countries are sentenced to permanent Depression and the rest of the continent to creeping dissatisfaction and, with it, growing stagnation.
In a reversal of the American pattern, Europe made the mistake of creating an economic union before a political one, which has yet to take place and may never come to pass in the absence of a common citizenship and culture. In our time we’ve met Germans and Frenchmen, Spaniards and Italians, but never this abstract European who is supposed to arise under Brussels’ bureaucratic guidance. We’ve never even met anyone who speaks European rather than French or German or Spanish or Italian, though we’ve met quite a few who speak a common language-English. Just as we speak a variant of it here.
It was none other than the chief of France’s central bank who pointed out the big problem with Europe’s economy. The objective of that economy should be growth, he said, but instead it has become preserving the privileges and subsidies of a multitude of vested interests.
“The underlying objective,” said Christian Noyer, should be “growth. Not just a temporary spurt, sustained artificially by public spending, but strong and lasting growth that creates jobs and is based on the development of modern and competitive production capacity. This kind of growth cannot just be summoned up. It requires a profound change in public policy.” LEST WE Americans start to feel superior to our European cousins, note the resemblance between M. Noyer’s diagnosis of the trouble with the European economy and the results of Obamanomics here across the pond. Europe is just a preview of where our own economy is headed as deficits pile up and short lived stimulus packages fail to stimulate for very long-not the way sustained private investment would. Investments like Dassault’s here in Arkansas.
Government can encourage such investment by lowering taxes while providing the basic services and safety that a government should. Government can encourage innovation and capital investment, but it can’t guarantee prosperity. Though it can invite poverty by over-reaching. Europe provides a preview of what can happen here if misguided policies weaken Americans’ self-reliance rather than encouraging it.
Europe isn’t so much our competitor as our customer. And as Dassault has just demonstrated, our investor. Europe’s prosperity is linked with our own and so, alas, is its poverty. That’s why a protectionist policy of beggar-thy-neighbor may succeed only in beggaring all. And why mutual investment and freer markets serve all. Anybody who questions that old lesson need only look at the expanding Dassault operation at Little Rock, Ark.
Editorial, Pages 16 on 05/31/2013