Carrier Blackmails Trump, Still Moves Jobs to Mexico

“Companies are not going to leave the United States any more without consequences,” said our President-Elect today at the Carrier plant in Indianapolis as he basked in another well-executed PR stunt.

United Technologies, parent company of Carrier, is still moving 1,300 jobs to Mexico. And there will be consequences… for Indiana taxpayers, who will give up $7 million in tax breaks to overvalued and overextended United Technologies as a reward for not sending as many jobs across the border as it said it would.

What do we call it when you threaten to do something bad unless you get a sack of money?

In essence, United Technologies took Trump hostage and won. And that should send a shock wave of fear through all workers across the country.

Trump has endangered the jobs of workers who were previously safe in the United States. Why? Because he has signaled to every corporation in America that they can threaten to offshore jobs in exchange for business-friendly tax benefits and incentives. Even corporations that weren’t thinking of offshoring jobs will most probably be re-evaluating their stance this morning. And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America [Senator Bernie Sanders, “Carrier Just Showed Corporations How to Beat Donald Trump,” Washington Post, 2016.12.01].  

Take Trump hostage, says Senator Sanders? Sounds like fun! Let’s do some math: Trump is willing to give up $7 million (of Indiana’s money) to keep 850 jobs from going to Mexico. (The deal also keeps 300 HQ and engineering jobs in Indiana that Carrier intended to move to North Carolina, which only voted for Trump over Clinton by 3.7 points instead of 18.91 like Indiana—try harder for the Führer next time, North Carolina!) That’s about $8,200 per job. My fellow workers, send President-Elect Trump a letter. Tell him you want $8,200 or you’re moving to Mexico and offshoring your own job. For the cost of a stamp, my wife and I could get over $16,000! (One more key number: temperature in Acapulco tonight as I write is 78°F.)

The Carrier/UT charade proves that Trump will rule by fiat, not by sensible, sustainable policy.Trump believes he alone can make all of our dreams come true just by picking up the phone and asserting his will. But when he asserts that will, he gets played by the corporate blackmailers and must hide his failure in the latest Great Lie. To frost this arrogant cake, Trump makes sure to exclude from his Indianapolis event the local TV reporter, Rafael Sánchez, who broke the Carrier-to-Mexico story and made this whole PR play possible, because sharing credit—even fake credit—with the media is verboten.

Trump brings another German word to mind: Führerprinzip. But I can’t tell if I’m watching Adolf Hitler or Charlie Chaplin.

Mexico shrugs. The global economy rolls on. And America stumbles with a President-Elect who speaks of consequences but hands out more corporate welfare.


38 Responses to Carrier Blackmails Trump, Still Moves Jobs to Mexico

  1. Trump enlarges the swamp.

    Obama saved 1.5 million jobs by extending loans and guarantees to the auto companies – which they paid back with interest – the government acted using business principles and MADE money while saving the jobs, the companies, and the economy.

    It’s going to be a l o n g four years, if Trump lasts that long.

  2. I am bring those jobs back.Nothing but a racist, bigot and xenophobic.

  3. Darin Larson

    Cory, Trump is also giving Carrier a tax cut of about $120 million and a tax cut to the parent company of about $1.5 billion. No blackmail necessary. (These statements are subject to auditing by Don Coyote. Past performance is no guarantee of future results. Investments can and do lose money.)

  4. John Kennedy Claussen, Sr.

    I get a kick out of the fact that Trump admitted publicly that he had totally forgotten about his Carrier promise from the campaign until he saw a Carrier union worker from Indiana talking about it on TV. So I have to wonder what other promises from his campaign has Trump forgotten about, too. Actually, there are some I hope he has forgotten about and hopefully no one reminds him about them as well.

    But seriously, Trump only wins the presidency because of the electoral college with the help of rust belt states that are filled with factories and former factories. Yet, the Carrier concern wasn’t even on his radar until he happened to be watching the nightly news last week. Are you kidding me? This whole Carrier thing reminds me of the Trump University fiasco, which is to sell them something that they want to hear, but don’t deliver unless they remind you, or in the case of the Trump University students until they come calling with a lawsuit…..

    What we witnessed here today with Carrier is the beginning of the Janklow presidency, I mean Trump presidency. Well, actually it reminds me a lot of the way Janklow did business and politics. Like “Wild Bill,” Trump has and will continue to use I am afraid a mixture of racial divide and pro-business policies to realize his politics and their implementation, and usher in a new era of corporate welfare where the swamp becomes filled and not drained.

    It is sad that Trump chose corporate welfare over reality in dealing with Carrier. President Kennedy back
    in ’62 in dealing with the steel industries attempt to raise prices unnecessarily demonstrated how a president is suppose to act when dealing with big business and not be merely a cohort of them and their interests:

    http://www.peoplesworld.org/article/how-jfk-forced-steel-price-roll-back/

  5. Don Coyote

    @John: “Obama saved 1.5 million jobs by extending loans and guarantees to the auto companies – which they paid back with interest – the government acted using business principles and MADE money while saving the jobs, the companies, and the economy.”

    Really? The US Treasury says it lost $11.2B in the GM fiasco.

    “The U.S. government lost $11.2 billion on its bailout of General Motors Co (GM.N), more than the $10.3 billion the Treasury Department estimated when it sold its remaining GM shares in December”

    http://www.reuters.com/article/us-autos-gm-treasury-idUSBREA3T0MR20140430

    Actually the GM bailout ended up costing US taxpayers closer to $50B when you take into consideration that the old GM bondholders wrote off $23.6B in losses resulting in $6B in lost tax revenues. When you take into account the losses written off by GM itself, it cost the US taxpayers an additional $14B in loss tax revenue, losses that GM couldn’t have taken it they had gone through bankruptcy. And when GM built a new engine plant where did they decide to build it? Mexico! Thanks GM. The list is quite long. Here’s the ugly blow by blow:

    http://www.dcclothesline.com/2015/01/09/much-gm-bailout-really-cost/

    And when GM

  6. I’m waiting for Coyote’s justification of Carrier’s hostage-taking. If we add Darin’s numbers (source?), UT/Carrier gets $1.6B for sending 850 fewer jobs to Mexico—that’s $1.9M per job. At that rate, saving 1.5M jobs would cost Trump/us $2.9 trillion.

    On efficiency for government intervention in the marketplace, advantage Obama!

  7. mike from iowa

    What do we call it when you threaten to do something bad unless you get a sack of money? UH…..lobbying?

  8. mike from iowa

    Pence did the heavy lifting on this deal for several months. Drumpf, of course, takes the credit for something he did not do.

  9. Mittens Romney probably will get some lovin from the gang by not outsourcing any more jobs without one helluva back scratch. These guys are professionals at it, so this will be the new economic stimulus package between the wealthy. http://www.motherjones.com/politics/2012/07/bain-capital-mitt-romney-outsourcing-china-global-tech

    Been going on for years with China, and then they send the jobs to Mexico from there. Damn, we Americans are great business people when it comes to buying stuff that is overpriced. http://www.forbes.com/sites/haroldsirkin/2016/07/07/chinas-new-worry-outsourcing/#71df682a31c2

  10. Richard Schriever

    And the Trump brand is definitely way over-priced.

  11. Darin Larson

    United Technologies net income was 7.6 billion for 2015. Reducing the corporate tax rate from 35% to 15% is 20%. 20% times 7.6 billion is a $1.52 billion reduction in taxes.

    http://www.utc.com/News/News-Center/Pages/UTC-Reports-Full-Year-2015-Results-Affirms-2016-Outlook.aspx

    Carrier is a subsidiary so its income is included in the parent company’s numbers.

  12. mike from iowa

    That is also a 1.52 billion revenue loss for Uncle Sam which means more, severe, drastic, dynamic cuts in welfare for the poor.

  13. David Newquist

    Nobody ever claimed that the bailout of GM and Chrysler would not end up costing the taxpayers. The objective was to save jobs and avoid a full-fledged depression. The U. of Michigan’s Center for Automotive Research tracked the program.
    Center for Automotive Research (CAR) put out these numbers:
    1.88 million: Job losses in 2009-2010 if only GM had gone under.
    4.15 million: Job losses in 2009-2010 if the whole U.S. auto industry had shut down.
    $39.4 billion: The hit to federal and state governments, from lost tax revenue and jobless benefit payments, if just GM went under.
    $105.3 billion: The hit to federal and state governments if the whole auto industry had collapsed.
    The federal government had to step in “because the entire industry was in a depression, and it could have dragged the whole country into one,” says former CAR chairman David E. Cole.

    http://theweek.com/articles/454749/auto-bailout-officially-over-heres-what-america-lost-gained

  14. It is good to see the Republican solution to the ills of corporate skulduggery happen with just tossing money at it with no boundaries. Romney wanted to let Detroit go teats up and many other corporate raiders including Trump, felt the same. The Black guy said no, and they recovered for the best possible outcome for all with the exception of the raiders. Now would be a good time for the meat packing plant in Aberdeen to declare itself unprofitable here and find a home in Mexico. Rounds and Joop could collect yet again with a bailout to satisfy even more greed than their original EB5 crooked dealings.

  15. David Newquist

    Why Trump gets more hype out of 1,000 jobs than Obama does out of 16 million

    ://www.washingtonpost.com/business/economy/why-trump-gets-more-hype-out-of-1000-jobs-than-obama-did-out-of-16-million/2016/12/02/1bd7ac10-b8cd-11e6-959c-172c82123976_story.html?hpid=hp_hp-top-table-main_trumpecon-730pm%3Ahomepage%2Fstory&utm_term=.5ec42aac6f4b

  16. Don@ 00:13. 1. Recall that Bush, the dumber began the auto company bailout because his economy tanked. 2. Recall that most republicans opposed the auto company bailout – as if they would have rather had the companies and economy driven further into depression. 3. If the companies had liquidated there would have been no tax revenue from the companies or the bond holders – in fact it would have cost the US $39 to $105 billion. 4. The US made $15.3 when it closed out TARP – the totality of the auto, auto financer, and bankster bailouts. None of which was necessary if Bush and his side-kick Dick had not driven the economy to near depression.
    http://money.cnn.com/2014/12/19/news/companies/government-bailouts-end/

    The auto company bailout, in the long-term made the US economy money by saving jobs and creating about half a million new jobs.
    http://www.nber.org/papers/w21000

    Meanwhile Trump and Pence send 1,300 jobs to Mexico and think we should pat them on the back.

  17. 4.6% Hhm, what was the unemployment rate 8 years ago? Don? anybody?
    19,170, hhm, what was the Dow Jones Industrial Average 8-years ago? Don? anybody?

    Stand by for the inevitable Trump recession / depression.

  18. Don Coyote

    6.8% unemployment Nov 2008.
    4.6% unemployment Nov 2016

    8,376 Dow Jones Avg Dec 4, 2008
    19,170 Dow Jones Avg Dec 2, 2016

    So? It took Obama 8 years to get the unemployment rate down 2% points? Slowest economic recovery since WWII. Labor participation rate at it’s lowest since 1978. Thanks Obama.

    Even discounting the Trump Bump of 1,000+ points, the Dow is up dramatically but it’s been juiced by three rounds of quantitative easing which has pushed interest rates to essentially 0% leaving investors only one place to stash their cash. Every time the Feds breaths a word about raising interest rates the market swoons. And why wouldn’t it? US debt has doubled under Obama and the ability to service this debt with higher interest rates will be a major problem for the budget for years, no, decades to come.

  19. John Tsitrian

    The unemployment rate in February, 2009, BHO’s first full month in office, was 8.1% and rapidly trending upward. No question Obama made some inroads on that front. But the labor participation rate back then was a bit over 66%, which compares to a bit under 63% now. Obama never could turn that around or stop the downtrend. I believe it’s from this pool of disenfranchised workers that DT got his victory margins where he needed them.

  20. In May 2012, unemployment was at a recession-hangovery 8.2%. GOP Presidential candidate Mitt Romney said then that getting unemployment down to 6% or “perhaps a little lower” by the end of 2016. Romney was thus offering a yearly reduction of the unemployment rate by 0.55 percentage points per year as a reason to choose him for President instead of Obama.

    President Obama got the rate down to 6% by October 2014, in less than half the time Romney said it would take. From Nov 2012 to Nov 2016, President Obama lowered it from 7.7% to 4.6%, 0.78 percentage points per year. Benchmark his performance from the Nov 2009’s 9.9% (peak was Oct 2009 at 10.0%), and President Obama’s unemployment reduction rate is 0.76 percentage points per year for seven years.

    How much corporate welfare did President Obama give to achieve that better-than-Romney performance?

  21. John Tsitrian

    You’re fixating on the headline number, Cory. Robert Reich says that the non-participant number surged by 446,000 last month, putting the number of non-participants at 95 million. He thinks about half of those are aging baby boomers about to leave the work force and those who are receiving public assistance. The other half is composed of those who simply don’t have the necessary skills to compete in a modern labor force or those who are working at the margins, mostly under the table. On that basis, RR thinks the true unemployment number is 10%, and he’s dubious about Trump’s “neo-industrial policies” doing any good on that front. So am I, because even if we bring manufacturing back to the levels it once was, manufacturing jobs won’t suddenly appear, thanks to automation, mainly robotics. I agree with Reich that a much more radical approach is in order: a new WPA with the goal of repairing and upgrading the country’s physical infrastructure. Much as I dislike Trump, I think his success at selling snake-oil could translate into success at selling a program as radical as this. He’s already committed to the infrastructure rebuild-upgrade program. Now I think he has to understand that the mammoth size of it requires intense government support.

  22. Porter Lansing

    You’d think a group of white, working class Republicans, disenfranchised by the business leaders that make up the top end of their political party (who sent their jobs abroad) would find a way to re-educate themselves into one of the many jobs desperately looking for well paid participants. But, it seems this group feels “entitled” and is demanding our government spend our tax dollars attempting to bail them out. Was this approach accepted by them when the poor, disabled and seniors were labeled and demeaned as “entitled worthless moochers”? No … it wasn’t. Kinda tough being on the other end of the poop stick, huh “Trump’s Gonna Help Me” beggars?

  23. Porter Lansing

    From the Schadenfreude Holiday File … It’s comical and will become even more so over the session, to see that Carnival Al Novstrup and Self-Aggrandizing Stacey Nelson get to sit together in committee and direct SoDak Commerce. hehehe

  24. John T, didn’t President Obama want more investment in infrastructure? Isn’t GOP anti-Obama obstructionism the only reason we didn’t get that investment?

    Another thing about infrastructure investments: you can’t offshore jobs building roads and sewers!

  25. mike from iowa

    So? It took Obama 8 years to get the unemployment rate down 2% points? Slowest economic recovery since WWII. Labor participation rate at it’s lowest since 1978. Thanks Obama.

    Any wild coyote that overlooks the obvious doesn’t survive long. The problems with Obama’s recovery can be laid squarely at the feet of an obstructionist, hostile and racist congress who did everything legal and otherwise to prevent Obama from being successful. All you wingnuts know it. Man up and admit like Mitch McCTutle did when Obama was first elected.

  26. mike from iowa

    Been hearing that Drumpf’s infrastructure project is to give massive tax breaks to korporations already involved in building and no new funds for future projects.

    Just to ruffle feathers again, Drumpf had a chat with Taiwan’s elected head. http://www.nbcnews.com/news/world/donald-trump-s-call-taiwan-president-was-not-surprised-official-n691466

    Taiwan is expected to be the recipient of a massive Drumpf infrastructure project in the near future. Drumpf divestiture at work.

  27. John Tsitrian

    I don’t recall any infrastructure-specific Obama initiatives outside of his Recovery Act of ’09, Cory, but if he had them and they were blocked by GOP obstructionists, Pubs made a mistake. Actually, going back to the Recovery Act, he should have gone for much more than its $800 billion, considering that he had a friendly Congress. Christina Romer, on his CEA, pushed for much more, but Larry Summers had his way and the lower number resulted. Overall, I think O expended too much political capital on ACA and not enough on consolidating and strengthening the economy. But that was then, this is now. Trump has a shot at doing some serious good, I hope he takes it.

  28. I agree with John T regarding a WPA or CCC for infrastructure rebuilding and building for the very near future and beyond. At present, our grid cannot stand much further pressure on it for any kind of manufacturing and that is why we simply put things together here that are built elsewhere, like Mexico for instance. I saw and advertisement regarding Kawasaki that makes the statement of being “built” in the USA with components from off shore. That is not manufacturing, that is almost a DIY project.

  29. mike from iowa

    From the bill wingnuts blocked- Budget Committee Chair Mike Enzi (R-WY) said he and other Republicans are all for more infrastructure spending. They take issue, however, with Sanders essentially dictating tax reform policy to the Finance Committee by setting a long-term funding target. “That’s not the way we do it around here,” Enzi said Tuesday. “That’s why that went down.”

    A sound plan was defeated because wingnuts fee fees were hurt. Un-fecking-believable!

  30. Tomorrow, there is an referendum in Italy. Workers are realizing that they have been getting screwed and Democrats had better figure this stuff out right quick like. https://www.youtube.com/watch?v=-K8bf6dbYt4

  31. Whoa, another one in Indiana http://fox59.com/2016/12/02/trump-calls-out-rexnord-for-moving-jobs-to-mexico-after-making-deal-with-carrier/ Pence is gonna be busy. Daugaard needs to announce the closing of EB5 plant in Aberdeen to move to Mexico. Have Rounds by his side.

  32. Douglas Wiken

    Pense danced all around Trump’s lies and stupidity today. He kept repeating the same BS favoring Trump no matter what the question. He is a tool of deception and fraud.

    I was at the U of Rochester Pol Sci Dept over 40 years ago. One of the profs said the US was the coasts and American Airlines. Unfortunately, the Harvard and Yale types in the Hillary organization believed the center of the US was a vast wasteland and acted as if the Electoral College is irrelevant. We at least partially have these DC-Centric and Ivy-League-centrists to thank for the Trump victory. Couple that with media fascination on celebrity and we have a potential political national catastrophe boiling on the partisan stove.

  33. Richard Schriever

    Evidently this isn’t the first time Pence has bribed a company to stay in Indiana and they moved jobs out anyhow.

    “An IndyStar analysis found that the Indiana Economic Development Corporation — which Pence leads — has approved $24 million in incentives to 10 companies that sent work to foreign countries. Of those incentives, nearly $8.7 million has been paid out so far.”

    During that same period, those companies terminated or announced layoffs of more than 3,800 Hoosier workers while shifting production to other countries, where labor tends to be far less expensive.

    “The state has clawed back or put a hold on some or all of the incentives in four of those cases, returning $746,000 in taxpayer subsidies. But in the other six cases, the companies faced no consequences.”

    http://www.indystar.com/story/news/politics/2016/08/28/under-pence-state-gave-incentives-companies-offshored-jobs/89260966/

  34. Richard Schriever

    mfi – You’re correct about the nature of Trump’s infrastructure plan. Essentially, it’s a Federal TIF to private investors in private projects.

    }…Trump’s plan is not really an infrastructure plan. It’s a tax-cut plan for utility-industry and construction-sector investors, and a massive corporate welfare plan for contractors. The Trump plan doesn’t directly fund new roads, bridges, water systems or airports, as did Hillary Clinton’s 2016 infrastructure proposal. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. These projects (such as electrical grid modernization or energy pipeline expansion) might already be planned or even underway. There’s no requirement that the tax breaks be used for incremental or otherwise expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects.”

    https://www.washingtonpost.com/opinions/trumps-big-infrastructure-plan-its-a-trap/2016/11/18/5b1d109c-adae-11e6-8b45-f8e493f06fcd_story.html?utm_term=.5bcde40550d2