The Myth of General Dynamics-Electric Boat and Its ‘Middle Class Jobs’

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The author Joan Didion famously wrote, “We tell ourselves stories in order to live.”

In Rhode Island and Connecticut, we tell ourselves myths about Electric Boat in order to justify building war machines.

There are the obvious myths: that a fleet of nuclear-armed submarines costing upwards of $104-billion will be a force for peace in the world; that executives at parent company General Dynamics gobbling up millions of dollars in compensation each year on the taxpayer dime are “patriotic”; and that some other community will build these weapons systems anyway if Southern New England doesn’t—so why shouldn’t we?

The fourth myth, which might be the most rich, is that the top brass at General Dynamics-Electric Boat actually care about our community, that they’re people committed to providing us with “good middle class jobs,” the kind of “blue collar” work that still provides an income you can raise a family on.

When I interviewed Electric Boat’s head of human resources, Maura Dunn, last year, she went so far as to say the millions of dollars Connecticut and Rhode Island are coughing up to subsidize a highly lucrative business are, in fact, part of a “community project.”

B.S.

Electric Boat is not a philanthropic organization; it’s a company run by executives whose sole aim is making money. In pursuit of that objective, they will take and take and take without shame.

For example: read closely a Jan. 20 article in The Day newspaper of New London, Conn., titled, “EB official tours Ponemah Mill apartments.”

The story details Dunn’s recent trip to a revitalized mill space in Nowich, Conn., to check out potential housing for some of the estimated 14,000 new hires—maybe more—EB expects to take on over the next decade. As the story states, this hiring frenzy will bring in “many” recruits from other New England states and Connecticut residents outside the New London-Norwich area.

“You guys have really done an incredible job,” Dunn is quoted as saying. “I love all the light.”

There’s something else Dunn likes, and it’s further down in the story. It’s the continual state “aid” her company will be able to take advantage of, ultimately resulting in more money for General Dynamics at the expense of taxpayers.

The story explains: “The [mill] project has received a combination of loans from the state Department of Housing and Connecticut Housing Finance Authority, as well as Low-Income Housing Tax Credits and state and federal historic preservation tax credits.”

The report goes on: “One $1,400 unit Dunn toured Friday would be $1,050 in the affordable category for a family of four earning about $55,000 per year…[State Sen. Cathy] Osten said that income level would be consistent with some of the entry-level positions at EB.”

What this means is a housing development that was revitalized with considerable state funding to provide affordable rents to low-to-moderate income families in the Norwich area could now very well be redirected to housing new hires brought in from out of area to a profitable company paying its workers low enough wages to qualify for subsidized housing.

But, wait. I thought these were “good middle class jobs,” the kind you raise a family on?

I certainly don’t mean to question the idea of providing government-assisted housing to people who need it. But why is it being considered as a means to subsidize a Fortune 100 company that should—and absolutely could—be paying its workers enough to avoid government-assisted housing?

And the General Dynamics gravy train doesn’t stop there—not by a long shot.

Rhode Island has already dedicated more than $4-million to train EB’s workforce, and Sen. Osten has said Connecticut should cough up $150-million for training and infrastructure improvements at Electric Boat.

So, let’s get this straight: EB stands to be the prime contractor on a massive nuclear-armed submarine building project, but it expects Connecticut to pay $100-million to defray the cost of “acquisition of lands, buildings, machinery, equipment or any combination thereof,” as a bill being supported by Osten states.

The truth is politicians are jumping onboard a bandwagon right now, and General Dynamics-Electric Boat is absolutely reaping the benefits.

Osten is trying to ride the coattails of EB’s surge, as is Rhode Island Gov. Gina Raimondo, who is completely desperate to brand herself the “jobs governor.” Both of these officeholders are Democrats.

“It’s one of the places where you can get a good paying job without a college degree and feel proud of what you do,” Raimondo told me of EB in an interview last year.

But consider the fact that the state of Rhode Island has also acknowledged that the average EB worker being trained with government assistance is starting off at $35,600-per-year, an annual salary 441 times less than the $15.7-million General Dynamics CEO Phebe Novakovic took home in 2016, according to the UMass Lowell Center For Industrial Competitiveness.

In January, one company official told The Day entry-level jobs start at $14-per-hour and “progress based on experience.”

The website Glassdoor.com estimates that pipefitter salaries at Electric Boat range between $14 and $18 per hour. “This estimate is based upon 3 General Dynamics Electric Boat Pipefitter salary report(s) provided by employees or estimated based upon statistical methods,” Glassdoor discloses. “When factoring in bonuses and additional compensation, a Pipefitter at General Dynamics Electric Boat can expect to make an average total pay of $33,232.”

Granted three reports is a low sample to base an average on, but that measly salary figure is consistent with everything else we know about these supposedly well playing “middle class” jobs.

Electric Boat has said it plans to expand its workforce from about 15,000 employees in Connecticut and Rhode Island to 18,000 by 2027. And it says that could involve hiring 14,000 to 15,000 new workers as older employees retire.

EB’s game plan is pretty obvious—watch the senior, decently paid workers leave and replace them with younger employees at paltry wages.

Now consider these facts. A 2016 article in The Nation magazine reported that the poverty line in 2015 for a single person was $12,000 and about $24,000 for a four-person family. When the conservative think tank American Enterprise Institute and the Los Angeles Times asked survey respondents what they thought the “highest annual income a family of four can have and still be considered poor by the federal government,” the average answer was $32,293.

“In short,” Nation author Shawn Fremstad wrote, “conservatives did a poll on how much income it takes to avoid poverty, and the answer they got back was more than $8,000 above the federal poverty line.”

Fremstad goes onto report that “if the federal poverty line today was set at the same place relative to median income as it was in 1963 it would be about $33,000, rather than $24,000.”

So, Electric Boat is paying workers just above what is potentially a more accurate estimate of the U.S. poverty line and yet politicians have the nerve to calls these “good middle class jobs”?

It’s absurd. But there’s even more.

Recent annual reports from the Rhode Island Department of Revenue disclose that EB workers and their dependents have received more than $3-million in Rite Care and Rite Share state medical assistance since 2014—this despite the fact that the company also received nearly $14.3-million in state tax credits and incentives during that same period.

“Companies that are getting subsidies should really be providing adequate health insurance coverage to their employees at the workplace,” Phil Mattera, research director at the corporate accountability nonprofit Good Jobs First, said in a phone interview. “And, if they’re not, it’s kind of a signal that it’s a substandard job.”

And it can’t be ignored that all of the state money comes on top of the oodles of dollars going to Electric Boat every year via the Pentagon. According to usaspending.gov, EB was awarded $5.2-billion in contracts during the federal government’s 2017 fiscal year alone.

To put that into perspective, that same year Rhode Island received less than $1.4-billion in total funding from the Department of Veterans Affairs, Department of Education, Department of Labor, Department of Transportation, Department of Housing and Urban Development, and Department of Agriculture combined.

In 2017, Rhode Island and Connecticut, the two states where EB builds submarines, were collectively budgeted less than $1.6-billion by the Department of Veterans Affairs, roughly $3.6-billion less than what EB was awarded.

So much for the patriotic, “support our troops”-type platitudes politicians throw around when the time comes to “christen” and deliver one of Electric Boat’s new submarines to the U.S. Navy.

In short: the next time someone tells you EB is a venerable organization, direct him or her to this article.

 


 

profileAlex Nunes is an independent journalist based in Rhode Island. He has contributed reporting to NPR, Rhode Island Public Radio, The Providence Journal, and The Day of New London, Conn., among other news organizations. He holds a master’s degree in journalism from Columbia University Graduate School of Journalism, and a bachelor’s in sociology from Rhode Island College.

 


 

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