A month after President-elect Donald Trump announced a deal with air conditioning company Carrier to save hundreds of U.S. factory jobs that were slated for Mexico, officials say the agreement has yet to be finalized, and they have released few details about its terms.
The state of Indiana, where the affected jobs are located, agreed to give Carrier up to $7 million in tax credits over 10 years to keep the facility open. Trump and Mike Pence — Indiana’s Republican governor and the vice president-elect — have touted the deal as a victory for their incoming administration and an example of how they’ll jump-start the economy.
However, specifics have been elusive. Trump and the leader of the union that represents the Carrier workers have clashed over the number of jobs saved. It is also unclear whether the company received any federal concessions.
In response to an open-records request from The Washington Post, the Indiana Economic Development Corp., a state agency chaired by Pence, said Indiana law allows it to withhold information until a contract is finalized. The IEDC has taken this route “to enable effective negotiations on behalf of Hoosiers,” wrote Chris Cotterill, the agency’s general counsel. He said it will take up to three months to finish terms of the pact.
Cotterill said the state will eventually publish the terms, but they would not give The Post any record of Trump's involvement in the deal.
Jonathan Bruno, a legal scholar at Harvard University, said the law does not stop the state from providing such records before a final deal, but it does give the option.
“It’s hard to defend the continued secrecy of the deal,” Bruno wrote in an email. “Pence et al. are trying to have it both ways — they’re suggesting that the deal is ready for public consumption by taking credit for one aspect (some indeterminate number of jobs saved), while simultaneously asserting its confidentiality by withholding every other aspect of the terms.”
In the absence of details on the Carrier deal, players involved in it have been telling different stories.
When Trump visited the Carrier factory this month to praise its parent company, United Technologies, for not to moving the jobs to Mexico, for instance, he said the manufacturer planned to fix up the plant.
“United Technologies has stepped up,” Trump said in the Dec. 1 speech. “And I have to say this, they did it in such a nice and such a professional way. And they’re going to spend so much money on renovating this plant . . . $16 million.”
Four days later, United Technologies chief executive Greg Hayes said he would pour $16 million into automating, not renovating, the Indianapolis factory — and the updated technology would actually wipe out jobs.
“We're gonna make up $16 million investment in that factory in Indianapolis to automate to drive the cost down so that we can continue to be competitive,” Hayes said on CNBC’s Mad Money with Jim Cramer. “But what that ultimately means is there will be fewer jobs.”
The number of jobs saved in the Carrier deal also became a point of contention after Trump said he had rescued more than 1,100 positions, but Chuck Jones, president of the United Steelworkers Local 1999, said only 730 of his people, plus 70 supervisors, will keep their livelihoods in Indianapolis. Five hundred and fifty of the jobs will still be shipped out of the country. (United Technologies, meanwhile, still plans to relocate 700 jobs from a Huntington, Ind., plant to Mexico.)
Trump responded to Jones's correction by blasting him on Twitter.
Some have speculated Carrier halted its outsourcing plans to protect United Technologies' $5.6 billion worth of federal contracts. The company stayed vague in a Nov. 30 statement: “The incoming Trump-Pence administration has emphasized to us its commitment to support the business community and create an improved, more competitive U.S. business climate. The incentives offered by the state were an important consideration.”
Carrier also claimed last year that federal regulations stifled its profits and sent a list of energy efficiency rules it deemed burdensome to the IEDC. Trump, meanwhile, said he will support a “massive cutting” of regulations.
Cynthia Baker, a law professor at Indiana University, said it’s not unusual for state officials to announce economic development plans before unveiling the technicalities.
“As the public access law makes clear,” she said, “the details of the final incentive agreement will be made available after the deal is executed.”
Trump and Pence’s direct involvement, however, elevates the urgency for transparency, said Alex Howard, deputy director at the Sunlight Foundation, an open-government advocacy group.
“If there is negotiation going on between the elected representative of the people's interest and corporations, then that activity should be disclosed,” Howard said. “There should be a clear accounting of what was said and to whom and what kind of leverage was used. We can’t know if someone negotiated in good faith because we simply don't have that disclosure.”
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