Christopher DeMuth, used to argue that perhaps the most important thing Ronald Reagan did was fire the air traffic controllers. In isolation, it was not that big a deal. But the message it sent was hugely important at a time when Eurosclerosis was spreading in America. Reagan let it be known that the public-sector unions no longer had the whip hand and the government couldn’t be extorted.
Trump’s Carrier intervention may just send an equally loud, but nearly opposite signal: that the White House is going to pick winners and losers, that it can be rolled, that industrial policy is back, that Trump cares more about seeming like a savior than sticking to clear and universal rules, and that there is now no major political party in America that rejects crony capitalism as a matter of principle.
.. “The free market has been sorting it out and America’s been losing,” Mr. Pence added, as Mr. Trump interjected, “Every time, every time.”
I don’t begrudge Trump his distrust and/or ignorance of the free market. He ran on dirigisme, protectionism, and a cult-of-personality approach to issues of public policy (“I alone can fix it!” and all that B.S.). He has spent his entire professional life working, bribing, and cajoling politicians for special deals — and he’s been honest about it.
But Mike Pence is supposed to be one of us. He’s supposed to be, if not the chief ideologist of the Trump administration, at least the mainstream right’s ambassador and emissary in the West Wing. And here he is casually throwing the “free market” under the bus in order to elevate crony capitalism, industrial policy, and rule of man over rule of law. Does Pence really believe that America loses in the free market every time? Really?
.. And for eight years Paul Ryan, Mike Pence, and nearly every major conservative critic of the Obama administration has, as a matter of routine, denounced the way the Obama administration picked winners and losers in the economy.
.. He’s a “pragmatist” who goes by his gut (after all, he only intervened with Carrier because he saw a story on the news).
The Carrier Deal and Trump’s Challenge to Democrats
the public’s attitude toward big businesses and their chief executives was extremely negative. Just twenty per cent of Americans, Greenberg explained, had a positive opinion of C.E.O.s. Many people regarded the country’s top executives as members of a self-enriching élite, which lines its pockets by cutting wages and shifting jobs overseas.
.. “We thought we were running against trickle-down. We now find ourselves running against a nationalist message focussed on making work for people.”
.. Last week, its chief executive, Louis Chenevert, left the company with a retirement package worth a hundred and seventy-two million dollars, most of it in stock and options.
.. shutting it down and moving production to Monterrey, where workers earn about fifty dollars a week, would have juiced United Technologies’ earnings a bit. That, in turn, could have given a boost to the firm’s stock price—and further enriched the huge remuneration packages enjoyed by Chenevert and other top executives.
.. Carrier, however, is still planning to relocate six hundred jobs from the Indianapolis plant to Mexico, plus seven hundred jobs from a second plant in Huntington, Indiana, which will be shut down. Taking the two plants together, more jobs will go than will be saved.
.. “The free market has been sorting it out and America’s been losing,”
.. In his 2012 State of the Union speech, President Obama proposed a series of measures designed to discourage outsourcing. They included eliminating the tax deductions that companies can take when they shift jobs abroad, and expanding tax breaks for investment in domestic manufacturing.
.. the Obama Administration never suggested that it would be possible, or even beneficial, to stop offshoring entirely. Instead, it stressed the need to educate the workforce; develop industries of the future, such as clean energy; and retrain displaced manufacturing workers.
.. since the start of 2009, when Obama took office, the economy has created more than eight hundred thousand manufacturing jobs.
Trump Warns that Companies Shipping Jobs Oversees Will be Slapped with Enormous Bribes
President-elect Donald J. Trump drew a line in the sand on Friday as he warned that U.S. companies planning to ship jobs overseas will be slapped with enormous bribes.
“If you think you’re going to get away with sending jobs out of the U.S., think again,” Trump said. “You are about to be bribed, big league.”
Deal for Carrier to Keep U.S. Plant Open May Hinge on Tax Overhaul
Talks include the conglomerate’s plans to shift more than 2,000 jobs from Indiana to Mexico
The incoming president’s goal is to show that he can keep some of his boldest campaign promises, and the CEO needs to keep peace with the federal government, a critical customer for products like its jet fighter engines. Military sales account for roughly 10% of the company’s $56 billion annual total, the company says.
United Technologies, like other globalized U.S. companies, also has large reserves of cash overseas—profits that corporations are waiting to repatriate to the U.S. until Congress cuts the level of tax they would pay. The company reported that 85% of its total cash, or more than $6 billion, was overseas, as of the end of 2015.
.. Democratic Sen. Bernie Sanders said Saturday that Mr. Trump must make it clear that if United Technologies “wants to receive another defense contract from the taxpayers of this country, it must not move these plants to Mexico.”
.. The company is the sole provider of jet engines for the F-35 Joint Strike Fighter.