If you’re a Connecticut resident who was caught off guard last week by Democratic Gov. Dannel Malloy’s announcement of an $83-million subsidy package to U.S. Navy contractor General Dynamics-Electric Boat, don’t worry—you weren’t alone.
That’s because, while Malloy’s self-described “historic long-term partnership” with Electric Boat had been in the works for months, the giveaway to cover infrastructure expansion and workforce development costs at Electric Boat’s Groton shipyard was virtually impossible for the public to follow and weigh in on in any meaningful way.
From what the public could see, it all started in January when Sen. Cathy Osten (D-Sprague) announced her plan to introduce a bill offering $100-million to Electric Boat for facility expansion, and another $50-million for employee training. A placeholder for the “Act Concerning Funding For Submarine Jobs and Opportunities” was posted online with zero details and then never updated.
Eventually, and unbeknownst to many, a new piece of legislation suddenly sprang up: Raised Bill No. 535, “An Act Establishing the Apprenticeship Connecticut Initiative.”
The title was a euphemism for “corporate welfare to EB.” While never mentioning the company by name, it called for $100-million in grants for infrastructure improvements to a business “engaged in the design, construction and lifecycle support of submarines for the United States Navy.” There’s only one company other than Electric Boat that fits that description, and it’s located in Newport News, Virginia.
The bill also outlined a convoluted framework to administer funds towards “work force pipeline programs,” a likely Trojan Horse for more money to Electric Boat and its suppliers.
The Finance, Revenue and Bonding Committee sought testimony on the proposal, and the Connecticut Association of Smaller Manufacturers submitted its input in writing, arguing the bill was “masking a hidden agenda.”
“The Federal government pays submarine manufacturers billions of dollars to deliver and service their products and these manufacturers can well afford their own capital spending,” the organization wrote. “During a time of fiscal distress, this is an insult to the Connecticut tax payer. Imagine what we could accomplish if we gave our technical high schools a $100M grant?”
Colleen Shaddox, an activist with Together We Rise CT, made a trip to the capitol to give her testimony against the bill in person, speaking at the 7-hour point of a 10-plus-hour day of testimony on a slew of proposals before legislators. When she was done, no member of the Finance Committee had a question for her.
“That told me they’d decided this was not something they were investigating,” Shaddox told me by phone earlier this week. “It was a sham. I wasn’t really participating.”
The bill passed a committee vote, and then what little news coverage there was of its progress appeared to stop completely. That was until last Monday when Gov. Malloy announced what he called “good news that will create jobs.” What had started off as a bill working its way through the democratic channels of the General Assembly was now a done deal the governor was showing off. Presumably lawmakers in this cash-strapped state will now have to work out the details of how this whole thing gets funded in the budget.
“I’d like to say I was shocked, but I wasn’t,” Shaddox told me. “There is a long history of accommodating Electric Boat and its parent company, General Dynamics…It doesn’t surprise me that the governor bypassed the legislative process and handed out some taxpayer largesse to these people.”
Only a few days later, Rhode Island Gov. Gina Raimondo, also a Democrat, announced another subsidy—worth up to $34-million—to Electric Boat, which operates a second shipyard in her state.
This time, Raimondo didn’t even bother with the pretenses of democracy. The deal was cooked up by her office and sprung on Rhode Islanders as unquestionably good news. According to television station WPRI, the money “was included in her budget for the upcoming fiscal year.”
Some people might be happy about the subsidies. Executives at Electric Boat who have worked elected officials and greased the wheels for years with obscene campaign contributions at the state and federal levels certainly are.
But fiscal conservatives are outraged that their state taxes are going to a company already bankrolled by federal taxpayers. And peace activists don’t like that more of their money is now going toward underwriting the building of weapons of mass destruction; Electric Boat has been named the Navy’s prime contractor to build a new fleet of nuclear-armed submarines.
These critics need to also be alarmed by what the “incentive packages” say about the undermining of democratic processes in Rhode Island and Connecticut. Think for a second about how these deals were pulled off.
Connecticut essentially held sham hearings on a deal Gov. Malloy had apparently already made up his mind on and would push through regardless of the outcome in the General Assembly. In Rhode Island, Gov. Raimondo—in the midst of a re-election campaign that’s prompted her to clog Facebook feeds with ads stating, “I want to hear from you. There’s nothing more important to me”—didn’t even bother to seek out serious public input.
This all might be because many people in both states are tired of seeing their elected officials cling to a military economy that’s as immoral as it is prone to boom and bust cycles. These residents want to see their state investing in areas that provide stable jobs and have a direct positive impact in their communities: public transportation, the renewable energy sector, health care, infrastructure, and schools.
Raimondo and Malloy have gotten around this through unilateral decision-making and by controlling the narrative, portraying unnecessary corporate welfare as a story that’s solely about jobs and their status as “jobs creators.” The media in both states, unfortunately, have largely fallen for this spin.
Take for example just a few headlines over the past year:
“A win-win at Electric Boat,” gushed a Providence Journal editorial in January on the more than $4-million in subsidies Raimondo had already awarded to Electric Boat.
“Exciting news at Electric Boat,” another Journal editorial proclaimed last week, going on to say the new subsidy “price seems to be well worth it.”
“Electric Boat ‘Hiring Frenzy’ Gives Economic Boost to Southeastern Connecticut,” the Hartford Courant wrote last July.
And: “Electric Boat to add 1,300 jobs in RI with new $792M expansion”—that was WPRI focusing on what the company says it will invest, rather than the $34-million taxpayers will fork over to General Dynamics, a Fortune 100 company.
As I perused responses on Twitter to my posts pointing out the flaws of the recent subsidy deals, I sensed more people would be questioning these handouts if the media had better informed them on the dynamics at play.
Chris Sanacore summed up in a tweet what I imagine the thoughts of most people would be if they were given the full Electric Boat story: “I was so for the EB initiative but the more I he[a]r about it the sketchier it is.”
Indeed. Consider that Electric Boat’s own president, Jeffrey Geiger, has already donated $3,000 to Raimondo’s campaign, all of that money coming after she became governor in 2015. By her own admission, Raimondo began working on better ways to “support” Geiger’s company shortly after she took office and received a surprise call from the executive.
As governor, Raimondo has accepted $11,100 in contributions from EB employees, all but $1,100 of that in the from $1,000 level donations, according to records available online from the state Board of Elections. Her predecessor, Lincoln Chafee, elected as an independent and now a Democrat, received only $425, the highest single donation being $200.
Geiger, meanwhile, has personally donated a combined total of $10,300 to the campaigns of U.S. Rep. Jim Langevin (D-R.I.) and U.S. Rep. Joe Courtney (D-Conn.), according to the Federal Election Commission’s website. Both congressmen are longtime members of the House Armed Services Committee.
When measured in PAC and individual donations, General Dynamics, according to estimates by the Center For Responsive Politics in Washington, D.C., is the top contributor to Langevin, Courtney, and Rhode Island’s senior U.S. Senator Jack Reed, donating a combined total of $456,050 to the campaign and leadership PAC accounts of the three lawmakers.
Reed, the ranking Democrat on the Senate Armed Services Committee, as well as Langevin were both on hand last Thursday for the announcement of Raimondo’s “investment” in Electric Boat. Courtney was there for Malloy’s news conference.
All this corporate-political symbiosis and backroom deal-making raises one crucial question:
If the point of a Pentagon contractor like General Dynamics is to build the “tools” our service members need to keep us safe and protect our freedoms, then what exact “freedoms” does the company think it’s promoting?
If it’s the freedom of the people to self-govern and set the direction of policymaking done on their own behalf, then executives like Jeffrey Geiger might want to consider if holding elective officials hostage through excessive campaign donations—legalized corruption, really—undermines the very idea of democracy.