As a longtime celebrity and television performer, Donald Trump knows the value of a good story to shape people’s views of a larger issue, even if what you’re convincing them to believe is utterly false. There’s an economic story developing — about two factories in Indiana that belong to the Carrier corporation — that Trump is hoping to use as a triumphant tale demonstrating how he’ll make America great again by bringing factory jobs back, particularly in areas that were once manufacturing hubs but are now distressed.
It’s based on a fundamental lie about the American economy. But the story will still be powerful, and it’ll be some time before most people realize how hollow it is.
You may have heard about how Carrier, which makes things like furnaces, announced earlier this year that they’re going to move 2,000 jobs from two plants in Indiana to Mexico in order to save on labor costs. On the campaign trail, Trump brought up Carrier frequently, saying that he would convince them, either through inducements or threats, to keep those jobs here. And he’s already working on it: “Representatives for the incoming administration, including Vice President-elect Mike Pence, have held wide-ranging policy talks with top-ranking executives at Carrier’s parent company, United Technologies Corp.,” reports the Wall Street Journal. Bernie Sanders has also joined in, saying “I call on Mr. Trump to make it clear to the CEO of United Technologies that if his firm wants to receive another defense contract from the taxpayers of this country, it must not move these plants to Mexico.”
So what was formerly a pretty straightforward decision for UTC has become much more complicated because of all this attention, including from the incoming president of the United States. They may well decide that the money they’ll save by moving those jobs south — estimated at $65 million a year — is nothing compared to their billions of dollars in defense contracts, and to forestall any threat to those contracts, and to their public image, the best move is to keep those Indiana factories here. Which would be great for the people working there.
If and when they make that decision, it will be front-page news. Every Republican will rush to the cameras to tout Donald Trump as a hero. People all over America, particularly those hoping for a return of manufacturing jobs, will say, “Hey, it looks like he can really do what he promised!”
So why do I say it’s a lie? Because Trump’s argument is that America has lost manufacturing jobs because of bad trade deals, and if we negotiate better deals, we’ll get all the jobs back. If Carrier decides to keep those jobs here, it will be seen as proof — after all, didn’t Trump just negotiate a deal that saved jobs? But that has nothing to do with the problem of American manufacturing.
Trump is selling a vision of manufacturing as it was in the 1950s, where workers with modest skills went to work in factories that employed huge numbers of people in good-paying, secure jobs with excellent benefits. That world doesn’t exist anymore. In some cases it’s because those jobs have moved overseas, not because of bad deals, but because people in Mexico or China or Vietnam will work for wages Americans won’t accept. The reason you can buy a 12-pack of tube socks at Walmart for $5 is that the socks aren’t made by people earning the kind of wages Americans demand. That’s a reality of different countries’ states of development, not a question of whether a trade deal is “bad.”
But the most important reason manufacturing jobs have disappeared is automation. When Trump says we don’t make anything anymore, he’s lying. In fact, we make lots of stuff — we just need fewer and fewer workers to make it. Ana Swanson explained yesterday:
The relationship between factories and workers has changed over the past decades, and it’s unlikely to go back. Over the past 35 years, the United States shed about 7 million manufacturing jobs. And some industries, such as textiles and apparel, have disappeared almost entirely.
Yet American factories actually make more stuff than they ever have, and at a lower cost. Manufacturing accounts for more than a third of U.S. economic output — making it the largest sector of the economy. From that perspective, it’s hard to argue that American manufacturing today is anything but a success.
The issue is that the fortunes of factories themselves and of manufacturing workers have diverged…U.S. factories now manufacture twice as much as they did in 1984, with one-third fewer workers, according to the Federal Reserve.
There might be a case here or there, like with Carrier, where Trump can get personally involved and convince a company that keeping some existing factory jobs in place isn’t worth the punishment he’ll inflict on them, either in PR or to their other businesses. But what he can’t do is turn back the clock on decades of automation. A factory that employed 2,000 people could in an earlier era be the economic anchor of an entire region; a factory that produces the same goods but only needs 200 workers to do it isn’t going to have nearly the impact.
Not only that, Trump will be signing Republican policies that represent the opposite of that happy 1950s vision of American manufacturing. They’ll be keeping the minimum wage low, making health care less secure, undoing regulations on worker safety, and engaging in an all-out assault on the unions that negotiated those high wages, good benefits, and job security. Look for a national “right to work” law meant to stab collective bargaining in the heart.
In other words, Trump and the Republicans plan to nationalize the Southern economic model, which says that if you release corporations from the burden of taxation and roll back worker protections, you can attract jobs. Sometimes it works — but those jobs are inevitably less secure and lower paying.
So just remember that when Carrier decides to keep those Indiana factories open, it’ll be a great day for the 2,000 people whose jobs are saved. But if you think it means that Donald Trump is making America great again, you’re being conned.