Posted: 02/17/08 15:42, Edited: 02/17/08 20:25
by Dave Mindeman
Minnesota's relationship with Northwest Airlines has been similar to a spoiled little rich kid's constant financial demands given to his wealthy parents. Northwest is the kid and the State of Minnesota is the, not really so wealthy, parents.
A chronology of the Northwest/State of Minnesota relationship can be viewed on the legislative web site. It is truly a one sided story, yet, here we are again, hoping the airline behemoth will show a sense of gratitude.
Some of the highlights of this relationship:
In the 1980's, the Metropolitan Airports Commission spent a total of $109 million in construction to facilitate an NWA/Republic merger.
In 1991, NWA sought an $838 million aid package which ended up passing in 1992 as a $761 million agreement -- with several guarantees from the company. (with questionable results)
In 1992, MAC made a $270 million loan to NWA.
In mid 1992, NWA eliminates 1500 jobs in Minnesota -- only 502 in the rest of the country.
In 1993, the pilot's union agrees to $866 million in wage and benefit concessions.
In 1994, NWA begins to renegotiate the 1992 agreement and begins renegging on original promises....state reduces loan guarantees.
In 1995, NWA lobbies to remove a corporate franchise tax...which the legislature does.
In early 90's, NWA lobbies and threatens state regarding proposed expansion of airport to a new location...which might have expanded competition. The lobbying effort is successful.
In 1997, NWA cancels agreement to build an engine overhaul facility in Hibbing.....outsources the work to France.
In 2001, the 9/11 attacks prompt NWA to lay off 10,000 workers.
Near end of 2001, NWA still reports a small profit, thanks to a $250 million dollar Federal bail out.
In 2003, NWA blames the war in Iraq for another 4900 in job layoffs.
December of 2003, employment at the the Duluth maintenance base is reduced by 40% despite the 1992 agreement terms.
2004, an $860 million expansion of the airport is announced...paid for by Federal grants and traveler user fees. The expansion plan would add 34 gates at Lindbergh used exclusively by NWA, Delta, and Continental. (Delta is the proposed merger partner for NWA).
2005...NWA announces another 930 job layoffs for mechanics.
So despite billions of dollars of investment by the state and federal government, NWA is about to tell the state, "Sorry, business is business."
I would bet that if the State of Minnesota added up all the money spent on Social Services over this period that it wouldn't even come close to the amount of "welfare" this State has given to NWA.
Thanks, NWA, for being such a great "partner".
