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Thu Dec 1, 2016, 08:31 AM

Carrier played Trump, taxpayers, more to come

Carrier getting tens of millions of dollars in incentives, while still outsourcing 1,100 jobs to Mexico.

Socializing costs, Privatizing profits


The Financial Times reported:

Carrier’s decision to cancel plans to move 1,000 jobs to Mexico was on Wednesday painted as a trade-off for planned tax cuts, as one of Donald Trump’s economic advisers said he hoped other US businesses would see the deal as a “beacon signal” of a climate where they can keep more jobs at home. Donald Trump secured a victory after successfully pressuring Carrier, a unit of United Technologies, to change its plan to move 2,100 jobs to Mexico to cut costs. Carrier said it would keep about 1,000 jobs in Indiana, after negotiations with Trump representatives including vice-president elect Mike Pence who offered unspecified incentives.

….

When asked whether the deal would set a precedent for companies to demand a tax break in exchange for keeping jobs at home, Anthony Scaramucci, a Trump adviser, said: “Companies should expect a tax break. We have the highest corp tax rates in the industrialised world, we have to get those corporate tax rates down to a competitive position . . . I’m hoping that every CEO in America is getting that beacon signal from the new Trump administration.”

What about the other 1,100 jobs that are still going to Mexico? Oh, those are still leaving.

The troubling aspect of the bad deal that Trump cut for taxpayers is that his adviser said that they expect every company in America to go after the same kind of deal. The idea that the US has the highest corporate tax rate of anywhere in the world is not true. While top US corporate tax rate is high, but Republicans have been exaggerating the damage caused by this fact for years.

The goal of the Trump administration appears to be a nation where corporations pay no taxes. If corporations aren’t paying taxes, and the wealthy are getting tax cuts, the tax burden will fall on the shoulders of those who have the least to pay the most.

If corporations around the country follow Carrier’s lead, state and local economies around will be damaged, if political leaders give in to extortion threats.

The bottom line is that Trump and Pence got played by Carrier. The company is still outsourcing more jobs than are staying, but for giving Trump some good publicity, they are being rewarded with tens of millions of dollars in incentives that Indiana taxpayers are now on the hook for.

Trump got played, and even worse he set a precedent for even worse deals to come.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 08:35 AM

1. If I were an American company and didn't plan on moving outside the country,

I'd be threatening to move and cut jobs to cut those goodies.

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Response to no_hypocrisy (Reply #1)

Thu Dec 1, 2016, 08:43 AM

2. That is rampant here in Florida

The GOP runs the state and will give away their grandmother and build access roads to corporations and build stadiums for billionaires and we foot the bill.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 08:59 AM

3. I doubt they got played. They were willing collaborators.

 

As you note, Trump gets good publicity out of the deal. "Trump saved jobs!" will be the only takeaway for his fans. They won't care that it will be taxpayers who end up paying for it.

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Response to Demit (Reply #3)

Thu Dec 1, 2016, 09:05 AM

5. His fans are not self aware enough

to feel the hand in their pocket

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Response to HAB911 (Reply #5)

Thu Dec 1, 2016, 10:01 AM

8. And that is because

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 09:00 AM

4. Who the Hell is stupid enough to still believe in the Republican "trickle down economy" bullshit?

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 09:09 AM

6. He's a yuuuge negotiator. He will do the best negotiations ever.


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Response to HAB911 (Original post)

Thu Dec 1, 2016, 10:00 AM

7. Don's a one-trick-pony. Once a con, always a con.

We know that. Wait until his supporters figure it out. Unless Trump manages to persuade them that every failure of his is due to the media/liberals/GOP Establishment etc.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 10:10 AM

9. it's all donald trump showbiz now! facts don't matter, only optics.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 10:13 AM

10. It's the art of the deal, folks!

Big companies get rich and we get fucked. But it doesn't matter because... jobs.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 10:19 AM

11. Doesn't matter. He got the propaganda he wanted

The real point of the exercise was to give the compliant media a fairytale story about how tRump was 'keeping his promises' and 'being a strong leader'. NPR has been constantly spewing this crap. No mention is made of the jobs leaving, or the nearly $1000/person per year cost to 'keep' the remaining ones there.

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Response to HAB911 (Original post)

Thu Dec 1, 2016, 11:10 AM

12. $700K for carrier in Indiana? That's a great deal compared to gun manufacturers in NY...

"...{Sen Kruger} is referring to $5.5 million that went to Remington Arms in the last five years. The incentives to Remington in New York are among $19.9 million given by nine states to makers of assault weapons in the last decade and were revealed in a list compiled by the Maine Center for Public Interest Reporting.

The $5.5 million that went to Remington and its parent company, Freedom Group, led to the consolidation of manufacturing plants in Massachusetts and Connecticut to Ilion, N.Y., where Remington has manufactured firearms for nearly 200 years.

They were down to close to 600 jobs and now they’ve more than doubled that,” says Sen. Jim Seward, Ilion's representative in the legislature. “These are good manufacturing jobs and obviously we want them to stay.”"

http://innovationtrail.org/post/millions-incentives-go-firearms-industry-new-york



Good for Cuomo et. al. to keep them there then - 2013. (but they have since moved to Alabama "due to gun laws".

Huh - companies using leverage to gain tax breaks - who knew?

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