I’m no fan of Donald Trump’s behavior, phony numbers and temperament, all of which I’ve dissected over the years.
But when it comes to bodyslamming big companies like Carrier that want to move jobs out of our country to make Wall Street happy by keeping reported profits rising, Trump and I are totally on the same side. This despite the fact that many people disapprove of Trump smacking Carrier around.
Let me explain. On the whole, I think our country’s much better off than it used to be, Trump’s “Make American Great Again” mantra notwithstanding. But when it comes to calling out giant corporations for anti-social behavior, I think we’re worse off than we were.
Maybe — just maybe — a big, fat dose of public shaming from the president-to-be and some of his big hitters will get some of these companies to behave less badly.
Back in the day, companies would occasionally change their behavior when some media outlet or politician made a big enough fuss about mass corporate layoffs or tax avoidance or some other distasteful activity that damaged the fabric of our country in order to propitiate Wall Street.
But in recent years, fear of Wall Street has come to (forgive the expression) trump Corporate America’s fear of media or political outrage. However, watching Carrier — part of the giant United Technologies conglomerate — agree not to move 800 manufacturing jobs out of Indianapolis makes me hope that guilt, shame and fear could be coming back into fashion. And our country will benefit as a result.
The fact that Carrier is still going to move 1,300 or so jobs from Indiana to Mexico is distressing. But it’s less distressing than moving 2,100 jobs.
Given that we’re dealing with Trump, whose specialty is telling his public audience what he thinks it wants to hear and then doing whatever he wants, I wonder if there are back-room deals with Carrier, which a state agency said told it that firing 1,400 people in Indianapolis and moving furnace-making to Mexico would save $65 million a year.
Given that number, the $7 million, 10-year tax break Carrier is supposedly getting from Indiana —a handout that has stirred all sorts of outrage — is small beer. Besides, the Indianapolis Business Journal reported on Nov. 30 that Carrier turned down a similar offer earlier this year, according to former Indiana Lt. Gov. John Mutz. Mutz is a board member of the state agency offering the break.
In any event, $7 million over 10 years is almost a rounding error compared to the $300 million-plus of higher costs Carrier will presumably incur by leaving 800 of the 1,400 originally-to-be-moved jobs in Indianapolis.
(I’m guesstimating that cost number by taking 8/14ths of the $65 million of supposed moving-to-Mexico savings, multiplying by 10 and rounding down.)
But rather than brooding about Carrier extracting a few bucks from Indiana, which the state seems to have offered before Trump got involved, let’s just give Trump credit for preserving 800 American jobs. At least for now.
Sure, one-off dealmaking like this doesn’t solve the long-term problem of U.S. industrial employment, which is being cut by technological advances and by companies’ desire to reduce costs and help keep quarterly profits rising.
This has led companies to export jobs; to trim expenses such as R&D and advertising that are presumably good for the bottom line long term but not short term; and to push more costs and risks for medical care and retirement onto employees.
Reducing the corporate tax rate doesn’t solve these cost problems. Nor does Trump’s proposed idea—which I think could run into legal difficulties — of imposing tariffs on imports of companies that export jobs.
But now that I’ve found myself on the same side as Trump, I’ve got one suggestion: Instead of just pushing other people around, Trump should lead by example and sacrifice something.
If Trump truly cares about American jobs, he should insist that the licensed products that bear his family’s name be made in the U.S. instead of in places like China and Vietnam. In return, he and his family should accept lower licensing payments.
After all, if Trump expects Corporate America to accept lower profits by employing Americans in America, he ought to accept lower profits by doing that, too.