A lot of Trumpkins are thrilled about his deal with Carrier:
But as CNBC reported, it’s not because Trump’s so intimidating that his tough talk got Carrier to stay:
Trump’s deal with United Technologies includes $7 million in financial incentives provided by Indiana to keep 1,100 jobs at Carrier, the company’s heating and air conditioning unit, in the state. However, Carrier still plans to move roughly 1,300 other jobs to Mexico and close another facility in Indiana.
Trump promised to bring back jobs, so objectively he failed on two counts: no jobs came back to Indiana, and 200 more jobs than the 1,100 he ‘saved’ are leaving anyway.
There are a lot of reasons to look skeptically at the Trump deal. As Robert Shapiro, former undersecretary of commerce for economic affairs, said:
“We certainly don’t want to take as our guide to creating jobs special tax breaks for a company that earned $7.5 billion in profits last year, got $6 billion in defense contracts, paid its top five executives $50 million, in order to preserve 1,000 out of 2,100 jobs,” said Shapiro.
“It’s essentially a transfer from the taxpayers of Indiana, who are providing these tax breaks, to the shareholders of United Technology plus those 1,000 workers. That’s really not a model for creating jobs across America,” he added.
This is exactly the kind of thing conservative Republicans are supposed to hate. It’s transferring the tax dollars of hard-working Americans (tax dollars a lot of conservatives believe are stolen in the first place) and putting it into the pockets of rich guys. Funnily enough, one of those conservative Republicans called out Trump’s deal as crony capitalism:
When government steps in arbitrarily with individual subsidies, favoring one business over others, it sets inconsistent, unfair, illogical precedent. Meanwhile, the invisible hand that best orchestrates a free people’s free enterprise system gets amputated. Then, special interests creep in and manipulate markets. Republicans oppose this, remember? Instead, we support competition on a level playing field, remember? Because we know special interest crony capitalism is one big fail.
Mr. Trump’s Carrier squeeze might even cost more U.S. jobs if it makes CEOs more reluctant to build plants in the U.S. because it would be politically difficult to close them.
But Trump knows going around and catering to each business that threatens to send jobs across the border or overseas isn’t feasible. This Carrier deal, crappy as it is, is just spectacle like everything else he does. He knows that what people can see is infinitely more effective than what they can’t. It doesn’t matter that unemployment has decreased since hitting its peak of 10% in 2010 to the 5% it sits at now. Graphs like this
are too abstract for most people compared to the instantly-visible “I made a deal with Carrier, and now 1,100 people get to keep their jobs” bit that Trump’s turned this into. It works because you can see it. You can see the plant where the people work, you can see the workers who get to keep their jobs. You can picture in your mind one of the workers who kept their job being able to buy their kid a nice Christmas gift.
But that’s all it is. Spectacle. It’s nice that those folks get to keep their jobs (for now), but it’s essentially a drop in the bucket, and it’s still a net loss.