These two things aren’t really in contradiction. Rather, they are better seen as two sides of the same Trump-stamped coin. They are complementary facets of a Trump strategy that will likely combine a relentlessly pro-corporate agenda with aggressive, personalized dealmaking designed to save relative handfuls of manufacturing jobs where possible, thus employing his theatrical populism to cement his hold on the industrial Midwest.
The Carrier deal is great news for the plant workers whose jobs will be saved, as well as their families and surrounding businesses, and it’s good that today’s event will spotlight manufacturing workers’ general travails. But as both liberal (Jared Bernstein) and right-leaning (James Pethokoukis) economists have pointed out for somewhat different reasons, personalized job-saving through hectoring or cajoling individual companies isn’t necessarily good economics, and it certainly doesn’t constitute a broad-based strategy for bringing back manufacturing jobs. What’s more, we don’t know the details of the deal, which appear to include a package of state tax incentives and a promise of pro-corporate policy to induce Carrier to keep these jobs here. The details will matter a lot in determining whether it’s actually a good deal for the public.
But we do know what Trump’s broader economic agenda is beginning to look like. It is likely to include deep tax cuts for the wealthy and businesses, and aggressive deregulation through partial (or total) repeal of Obamacare, Wall Street oversight, and environmental regulations. Trump’s pick for Treasury Secretary says the rich won’t get a tax cut, because their slashed tax rates will be offset by nixed deductions, and claims that the middle class will get a big tax cut. But given practical reality and the actual details of Trump’s plan, it’s highly unlikely to happen that way.
Where is the pro-worker agenda in all of this, and if it does materialize, what will it look like? It’s certainly possible that Trump will make good on his vow to push for enormous sums of spending on job-creating infrastructure repairs. But that plan, too, is shaping up more as a cronyist privatization scheme than as a genuine blueprint for needs-driven public investments. Trump may actually pursue policies designed to prevent manufacturing jobs from leaving the U.S. But tariff schemes could cause a destructive trade war. And as economist Dean Baker details, there are trade policy options that might help American workers, but there is simply no telling yet whether Trump will actually pursue them.
Meanwhile, what we do know of Trump’s tax and deregulatory agenda is that it will harm untold numbers of lower income people through sharp cutbacks to various aspects of the safety net, including many of the workers Trump claims to champion. I continue to expect Trump to gravitate towards a form of “Reactionary Keynesianism” that combines regressive cuts to taxes and government programs with some form of boosted infrastructure spending that primes the economy while increasing inequality.
Indeed, until we hear differently, it’s most likely that Trump will be guided by some species of the philosophy that what’s good for big corporations is generally good for workers. At the same time, as Trump’s pick for Treasury explicitly put it, there will be more Carrier-like deals, achieved through “open communications with business leaders.” In other words, Trump, a master promoter, will sell that philosophy with personalized arrangements that help isolated pockets of manufacturing workers in ways that generate outsize media coverage that maximizes his political returns.
* TRUMP’S CARRIER SUCCESS IS TINY PART OF STORY: Today Trump will hold a media event in Indiana to tout his saving of 1,000 manufacturing jobs there, but the New York Times reports that many other jobs in the state are also leaving:
“I’ll give Trump his due, but I hope he and the American people and Congress don’t forget about all these other jobs going to Mexico,” said Chuck Jones, the president of Local 1999 of the United Steelworkers in Indianapolis, which represents Carrier. “Down the pike, a lot more are going to be moving out.”…Those 1,000 Carrier jobs saved represent just 0.2 percent of total manufacturing employment in the state.
But Trump will get a lot of good press, so this is a damn good deal.
* CARRIER WILL GET TAX BREAK: Max Ehrenfreund confirms that the company will get a package of state tax incentives in exchange for keeping jobs here:
Neither Carrier nor the Trump-Pence transition team released details about what financial incentives the company will receive. The Indiana Economic Development Corp., a state agency, will grant Carrier a tax break in exchange for keeping the plant open, said John Mutz, a member of the corporation’s board and a former lieutenant governor.
Maybe at their victory presser today, Trump and Pence will reveal exactly how throwing money at a company that is threatening to move jobs to Mexico constitutes standing up to it.
* BERNIE SANDERS RIPS CARRIER DEAL: The Vermont senator boils it down very effectively:
In exchange for allowing United Technologies to continue to offshore more than 1,000 jobs, Trump will reportedly give the company tax and regulatory favors that the corporation has sought. Just a short few months ago, Trump was pledging to force United Technologies to “pay a damn tax.”…Instead of a damn tax, the company will be rewarded with a damn tax cut. Wow! How’s that for standing up to corporate greed? How’s that for punishing corporations that shut down in the United States and move abroad?
The Art of the Deal at work.
* GOP MAY DELAY OBAMACARE REPEAL: Politico reports that Republicans are coalescing around a strategy of repealing Obamacare in a way that takes three years to take effect, to give them time to come up with a replacement. This is notable:
“We’re talking about a three-year transition now that we actually have a president who’s likely to sign the repeal into the law. People are being, understandably cautious, to make sure nobody’s dropped through the cracks,” said Senate Majority Whip John Cornyn.
Note the “nobody.” Cornyn appears to want you to believe that whenever the GOP replacement materializes, it will cover as many people as Obamacare now does.
* AMERICAN PEOPLE DON’T WANT REPEAL: Jonathan Cohn reports on a new poll from the Kaiser Family Foundation. Only 26 percent of Americans support full repeal (an additional 17 percent want it scaled back), while a total of 49 percent either want to move forward with implementing the law (19) or want lawmakers to expand the law (30).
Meanwhile, there’s overwhelming support for the law’s individual provisions: 80 percent support the portions that spend federal money to help lower income people get insurance. This is the rub: How many of those people will the GOP replace plan cover?
* THE REAL LESSONS DEMS SHOULD LEARN FROM 2016: E.J. Dionne has a good column arguing that, yes, Democrats need to improve their appeal to working class whites, but with an important caveat:
An effort to reach out to the white working class cannot be seen as a strategy for abandoning people of color, Muslims or immigrants, or for stepping back from commitments to gender equality, or for withdrawing support for long-excluded groups . . . Progressivism’s embrace of social and economic justice is about lifting up the left-out across all of our dividing lines. Remembering this is the first step toward political recovery.
As Dionne notes, Democrats outperformed in the Sun Belt, suggesting the party’s diverse coalition is key to its future — and must not be neglected as a source of strength.
* CLINTON’S POPULAR VOTE LEAD PASSES 2.5 MILLION: That’s per the latest calculations by Cook Political Report’s David Wasserman, who now puts her edge at 1.9 percentage points.
Remember, Trump has said the popular vote outcome (but not the electoral college outcome) was rigged by millions voting illegally. He can’t stand the idea that he might have gotten fewer votes.