By Jeff Patch
CEDAR RAPIDS, Iowa—At the tail end of President Obama’s campaign-style swing through Iowa, a bipartisan group of lawmakers joined a rally at the Rockwell Collins Flight Operations Center to push back on the Obama administration’s demagoguery of corporate jet use.
The back-up Air Force One, a mammoth 757 jet used to transport members of President Obama’s cabinet, was parked on the tarmac at the Eastern Iowa Airport in Cedar Rapids as about 250 workers and aviation activists rallied in support of the industry’s economic lift to Iowa and the United States.
A national lobbying group, the General Aviation Manufacturing Association (GAMA), organized the economic pep rally on behalf of Rockwell Collins and Goodrich Corp., which both have large Iowa operations. Rockwell Collins employs 1,400 people in Cedar Rapids and 100 more at other Iowa locations. The industry has a $1.2 billion impact on Iowa’s economy, according to industry data.
“I hate to have to differ with [President Obama], but you can’t go to Alcoa on a Tuesday and talk about the great aluminum on the wings of the airplane and then go bash the people that buy airplanes the next day,” Pete Bunce, the president and CEO of GAMA said in an interview. “It’s not going to affect them; it’s going to affect the people making airplanes.”
President Obama visited Alcoa Davenport Works in Riverdale in late June. The next day, he used a press conference to slam “corporate jet owners,” mentioning the phrase six times to convey a zero sum, false choice on tax policy.
“[I]f we choose to keep a tax break for corporate jet owners…, then that means we’ve got to cut some kids off from getting a college scholarship,” Obama said.
This week, President Obama stormed through Minnesota, Iowa and Illinois on a bus tour amid the lowest approval ratings of his presidency. Obama, traveling in a $1.1 million dollar bus manufactured in Canada, continued to blame President Bush for the nation’s fiscal woes and asked Iowans for ideas to energize the economy.
At Northeast Iowa Community College in Peosta Tuesday, Obama proposed a series of programs that would stimulate little besides dependency on the federal government. At the invitation-only “White House Rural Economic Forum,” Obama and U.S. Department of Agriculture Secretary Tom Vilsack announced a series of initiatives: $350 million in funding from the Small Business Administration over five years, government-led conferences to connect venture capitalists and start-ups, creating “capital marketing teams” to hawk “federal funding opportunities” to investors, a $510 million project to support bio-fuels and a government-run infrastructure bank.
“I’m looking forward to hearing from you about what else we can do to jumpstart the economy here,” Obama said Tuesday at the forum. Business leaders and Members of Congress answered that challenge at Wednesday’s rally: “He needs to know, if you go after our customers, you go after every one of us,” Bunce said in comments echoed by lawmakers and Rockwell Collins employees.
President Obama has proposed a relatively arcane adjustment in the tax code that would hurt small and large companies that rely on private aircraft for essential business operations. In 1987, tax law was modified to provide an incentive to allow the cost of business jets to be depreciated over a five-year period, rather than a seven-year period. The Congressional Budget Office has estimated that the change would increase revenue by $3 billion over 10 years. But GAMA said that the CBO’s estimate relies on production of aircraft remaining constant and removing the tax break would cripple the ability of businesses and farmers to efficiently use aircraft to grow their businesses.
“These machines make commerce happen,” Bunce said. “General aviation embodies the same spirit that helped create this country and make it the envy of the world.”
A bipartisan roster of elected officials showed up to support the industry, which employs about 2,000 people in Iowa, according to GAMA. The industry also supports 5,696 pilots in and 289 public and private airports in the Hawkeye State.
“In the big cities of America, the Midwest is considered flyover country. And you can probably understand, since Washington is an island surrounded by reality, to get a lot of ideas coming out of Washington that don’t fit in with what you and I know are our needs,” Sen. Chuck Grassley (R-Iowa) said. “Some of the very same people that want to get you out of your SUV and get you into a smart car are the very same ones who think that we should not have just a few people in an airplane—not understanding… that it’s hard to get from point A to point B in rural America.”
Grassley called on the crowd to contact President Obama and lawmakers to express their views: “Exercise your right to petition your government under the First Amendment for a redress of grievances,” he said. “You have a right to confront us anytime with your ideas and your positions on legislation, and we have a constitutional responsibility to consider your point of view… Don’t just do what [Rockwell Collins president & CEO Clay Jones] tells you to. Write to us on a regular basis.”
Rep. Tom Latham (R-Iowa), a senior member of the appropriations subcommittee on transportation issues, avoided criticizing President Obama by name but nonetheless hit back on his negative, anti-business rhetoric.
“There’s something that’s really been bothering me lately, if you listen to the debate in Washington, D.C. Some people have picked out this industry to vilify and somehow think that by demagoguing the issue that there’s political gain or something. I don’t understand it,” Rep. Latham said.
“The business aviation industry is a vital part of our economy,” Rep. Latham said. “We’re all in this together. That kind of talk has got to stop in Washington and around the country because we’re trying to grow; we’re trying to prosper—and to pick out and demonize people is simply wrong.”
Rep. Leonard Boswell (D-Iowa), who is facing off against Rep. Latham in the newly drawn third congressional district, stridently defended the use of corporate jets by Rockwell Collins executives, noting that he came to the defense of company CEO Clay Jones when he was grilled on the issue by a congressional committee in 2009.
“We can’t lose these jobs,” Rep. Boswell said in a folksy, mumbling speech laced with football and military metaphors. “We’ve gotta grow these jobs.”
Rep. Steve King (R-Iowa) defended the industry tax incentive by explaining how it benefits farmers using crop dusters and rural small business owners. King, whose father was so anti-Japanese after World War II that he prohibited the family from eating rice, framed the issue as crucial for U.S.-based manufacturing.
“The American quality has led the world and it leads the world. And you have watched as industry after industry has been transported over to other countries… because we have not been as aggressive as we need to be with our taxes and our regulation,” Rep. King told aviation employees. “If you stop inventing, America’s industry shrinks and the rest of the world will swallow us up because their labor prices our cheaper, and when they catch up with American intellectual power, they will catch up with us.”
“These planes are not a luxury, they’re a necessity,” Rep. King said, speaking from his experience as a construction executive. “You can’t do that without high-quality aircraft… We can’t do all this business over the Internet. It’s eye to eye.”
Even Rep. Bruce Braley (D-Iowa), a strong ally of President Obama, waxed eloquent about the benefit of business aviation, recalling how his hometown airstrip in Brooklyn, Iowa offered Iowa companies an ability to connect to American and international markets.
“[T]hat airport was important to my community, and it offered a window to the outside world that was important to the town I grew up in,” Rep. Braley said.
Sen. Tom Harkin (D-Iowa) and Rep. Dave Loebsack (D-Iowa) were conspicuously absent from Wednesday’s rally, even though invitations to the event were extended to the entire delegation in the first week of June.
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