Citizens take on DC Government over Tax Giveaways to Defense Contractor Northrop Grumman

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by Medea Benjamin

“I originally supported the $25 million offer to Northrop Grumman, but I have since had second thoughts. With the city facing a $200-300 million deficit, I see no reason to subsidize a multi-billion-dollar war machine.”
--DC City Councilman Marion Barry, March 10 in a telephone interview

A major struggle is brewing in the nation’s capitol about the city’s proposal to offer of $25 million in subsidies and grants to the mammoth defense contractor Northrop Grumman. The legislation was originally sponsored by seven of the City Council’s 13 members and supported by Mayor Adrian Fenty, but now that the DC community is mobilizing against the corporate giveaway, council members are having second thoughts.

On January 4 newly-hired CEO Wesley Bush announced that Northrop Grumman would move its headquarters from the Century City area of Los Angeles to the Washington metropolitan area by 2011. Bush wants his executives closer to lawmakers on Capitol Hill and to officials in the military and intelligence communities that make up the vast majority of Northrop's business. The company has already has been buying influence in Washington through an army of lobbyists, outspending its larger rivals Lockheed Martin and Boeing by more than $25 million between 1998 and 2008, according to the Center for Responsive Politics. The move will only increase its ability to land lucrative defense contracts.

Washington D.C., Maryland and Virginia have all been wooing the company. DC officials pitched the city's proximity to Capitol Hill power brokers; Maryland promoted its highly-educated workforce; and Virginia touted a business-friendly environment that includes a 6 percent corporate tax rate, compared with 8.25 percent in Maryland and 9.97 percent in the District (Forbes has ranked Virginia as the best state for business four years in a row).

But that wasn’t enough. This company with $34 billion in revenue and $2.5 billion in profits—most of it coming from government contracts--wanted a government handout. Company spokesperson Randy Belote said it is looking not only for the most suitable site with an abundance of amenities but also the best financial incentive.

http://www.commondreams.org/view/2010/03/12-8

[Subdivisions]

1. Taxpayer funded move of a private corporate entity? Business as usual. n/t

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2. Yep

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3. Bump

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4. Bump

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5. Bump

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6. Bump