From the people who supported spending $787 billion to create 4 million jobs in Obama's disastrous stimulus, comes a complaint that Indiana will give Carrier $700,000 to keep 1,000 jobs.
The stimulus cost $19,675 per job saved.
This Carrier deal is $700 per job, an amount easily recovered by state income taxes. This is a normal activity of Indiana's state economic development program. Governor Pence I am sure advised Trump of this.
The $700,000 is a fig leaf to save face for United Technologies (owner of Carrier) which decided to stay in the USA instead of running afoul of a president who could slap a 35% tariff on its products, just as President Reagan did on Japanese motorcycles to keep Harley-Davidson alive.
From the New York Times:
While Carrier will forfeit some $65 million a year in savings the move was supposed to generate, that’s a small price to pay to avoid the public relations damage from moving the jobs as well as a possible threat to United Technologies’ far-larger military contracting business.
Roughly 10 percent of United Technologies’ $56 billion in revenue comes from the federal government; the Pentagon is its single largest customer. With $4 billion in profit last year, the company has the flexibility to find the savings elsewhere.
Members of Congress have been pressing to punish big military contractors if they move jobs outside the United States.
Many industrial companies face intense pressure from Wall Street to increase profits, even when the economy grows slowly — a major reason United Technologies decided to move.It's called leverage. President Trump used it.
The Washington Post childishly pretended Trump lost with these stories:
Then there is the American Thinker, over-thinking the whole thing:
The hypocrisy and abandonment of free market principles with “conservatives” applauding Carrier's imploding to external political pressure should be the cause of great concern. For what is popularly seen as "Making America Great Again" by retaining jobs here in the U.S. is really an abuse of the office of the Presidency - using its bully pulpit to pressure companies into economic decisions it would otherwise not make. It is a shameful use of political power and is symptomatic of the corrupt elements inherent within demagoguery. But then again, a demagogue is who the people elected.
The pressure applied to Carrier (and Ford) is nothing other than a stealth welfare scheme -- because the reality of this is that consumers will be subsidizing these workers´ pay by paying higher prices for products that would otherwise be lower. This also puts the manufacturer at risk against foreign competitors who will now gain a competitive edge in labor costs. Are free market principles now subordinated to the exercise of national condemnation to oppress companies from acting in their own self-interest - the very self-interest that fuels the beneficial effects of capitalism? Are U.S.-based companies now the provincial vassals, indentured to serve a master no matter how inhospitable his rules are? Where is the liberty in all of this?A stealth tax? Really? So don't buy a Ford or a Carrier. Just as there is no right to a living wage, there is no right to a living price.
And yes we need these "provincial vassals" -- odd description of multi-billion-dollar companies -- for the protection of the nation. A country that is beholden to other countries for war matériel is not really all that independent.
President Trump promised to keep the jobs in Indiana. He delivered.
That he is making his critics cry is an unexpected bonus. Mmm. Liberal tears.