Tuesday, January 5, 2010

Adios California: "Defense titan Northrop Grumman to leave Los Angeles for D.C. area" And Eisenhower Stops By (NOC)

I give GE shit for being a rent-seeking entity but the defense types have been at the trough just as long with their snouts just as deep in the slop.
In his Farewell Address to the American People President Eisenhower nailed both brands of political capitalism. Here's the part most people know:

...In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together....

And the part they may not:

...Akin to, and largely responsible for the sweeping changes in our industrial-military posture, has been the technological revolution during recent decades.

In this revolution, research has become central; it also becomes more formalized, complex, and costly. A steadily increasing share is conducted for, by, or at the direction of, the Federal government.

Today, the solitary inventor, tinkering in his shop, has been overshadowed by task forces of scientists in laboratories and testing fields. In the same fashion, the free university, historically the fountainhead of free ideas and scientific discovery, has experienced a revolution in the conduct of research. Partly because of the huge costs involved, a government contract becomes virtually a substitute for intellectual curiosity. For every old blackboard there are now hundreds of new electronic computers.

The prospect of domination of the nation's scholars by Federal employment, project allocations, and the power of money is ever present--and is gravely to be regarded.

Yet, in holding scientific research and discovery in respect, as we should, we must also be alert to the equal and opposite danger that public policy could itself become the captive of a scientific-technological elite....

My friends on the far right don't like the first part, those on the far left don't like the second part and as for me?
I Like Ike.
From the Washington Post:

Northrop Grumman said Monday that it plans to move its corporate headquarters from Los Angeles to the Washington area by 2011, solidifying the growing importance of Washington as a center for the defense industry and other businesses.

Northrop executives said they are looking for a site in Maryland, Virginia or the District and plan to identify one by spring. The company, whose biggest customer is the Pentagon, makes military planes, missiles, ships and other equipment. It has about 40,000 employees in the Washington region and 120,000 around the world. About 300 employees would move with the headquarters.

"We are a global security company, and all of the federal processes, whether the executive branch or Congress, are in the Washington area," said Wes Bush, Northrop's chief executive and president. "We think we'll be able to do a better job for our customers and our company by having our corporate office there."

Bush said the company is looking for the best tax incentive package in each jurisdiction. Maryland is home to Lockheed Martin, the biggest U.S. defense contractor. And Virginia is home to General Dynamics, another major defense player. Other defense contractors, including Boeing and Raytheon, also have offices in the region....MORE

The Wall Street Journal looks at the larger picture in "Northrop To Move, Ending An Era"

Northrop Grumman Corp. said Monday it plans to move its headquarters to the Washington, D.C., area from Los Angeles, marking the departure of the last major aerospace firm from the industry's birthplace in Southern California....

...The company will relocate about 300 jobs, though it will still have more than 20,000 employees in the Los Angeles area, according to local officials.

Still, Northrop's move underscores a broader struggle for Los Angeles: It is the nation's second-largest city with 13 million people in its metropolitan area, but has suffered a growing exodus of corporations. In addition to defense and aerospace industries, there has been a steady erosion of its other iconic trade, the movie business, as states lure away film productions with rich tax incentives.

Other corporations based in Los Angeles have pulled up stakes recently. Hilton Hotels Corp. left Beverly Hills, Calif., last year for Washington, D.C. The area's once-prominent mortgage-finance industry imploded during the housing bust, with companies such as Calabasas, Calif.-based Countrywide Financial Corp. sold to Bank of America Corp.

The largest public company still based in Los Angeles County is Walt Disney Co., with headquarters in Burbank. However, major Hollywood studios, such as Time Warner Inc.'s Warner Bros. and Viacom Inc.'s Paramount Pictures, are part of media conglomerates based elsewhere.

Northrop's departure comes amid a backdrop of 12.6% unemployment in Los Angeles County in October, and widening budget shortfalls in both the city and state governments.

"It hurts whenever you lose a major multi-national corporation," said Jack Kyser, founding economist of the Kyser Center for Economic Research at the Los Angeles Economic Development Corp. He said the employees who will remain around Los Angeles County "would benefit if Northrop Grumman could effectively compete to get government contracts and then bring the work back here."

The aerospace industry blossomed in Southern California during and after World War II, turning the area into a locus of engineering talent. At the height of the Cold War, it was an economic engine, as thousands of workers designed and built the backbone of U.S. airpower and later satellites at sprawling hangars and production facilities throughout the region....MORE