Trump speaks at the Carrier plant after announcing a deal that will keep jobs in Indiana https://t.co/GQDLdHNy0h https://t.co/BGIB6888PG
— CNN Politics (@CNNPolitics) December 1, 2016
President-elect Donald Trump took a victory lap in Indiana on Thursday, celebrating his deal with Carrier to keep more than 1,000 factory jobs in the state that were slated to move to Mexico.
Trump framed the negotiation with Carrier as a signal that U.S. companies will thrive under a Trump administration, which is promising a lower corporate tax rate and fewer regulations. He promised to keep jobs in the U.S. as part of his campaign, specifically mentioning Carrier.
{mosads}“I want to let all the other companies now that we are going to do great things for business, there’s no reason for them to leave anymore,” Trump said from Carrier’s plant in Indianapolis. “Their taxes are going to be at the low end and the unnecessary regulations are going to be gone.
At the same time, he also warned companies they would face “consequences” of high tariffs if they decide to move manufacturing plants overseas to ship products back to the United States.
“These companies are not going to be taking people’s hearts out,” he added. “They are not going to be announcing, like they did at Carrier, that they are closing up and moving to Mexico.”
Carrier and its parent company United Technologies said Thursday that they will designate the Indianapolis plant, which produces furnaces, as a Center for Excellence and will invest $16 million to keep it updated.
In exchange, Carrier confirmed that Indiana’s government will give the company $7 million worth of tax breaks over a 10-year period.
Carrier initially had said it was closing the plant in Indianapolis and moving its 1,400 jobs to Mexico. Those layoffs were to begin in 2017.
Carrier’s parent company UT also announced in February that it was moving 700 jobs from its Electronic Controls plant in Huntington, Ind. to Mexico as part of the larger reorganization, according to the Indianapolis Star.
Under the plan announced Wednesday, Carrier said it would keep producing furnaces in Indianapolis, preserving more than 1,000 jobs at the Indiana plant. It did not mention the Huntington plant.
The Wall Street Journal reported Thursday that 800 of those jobs would have moved to Mexico under the previous plan.
Another 300 jobs in the company’s research and headquarters arms will also be supported by the tax incentives and stay in Indiana. Those jobs were not planned to be moved to Mexico, but would have been shifted to North Carolina under the earlier plan, according to Salon.
Reuters reported that Carrier will still move about 1,000 jobs to Mexico.
Trump pinned his inspiration for the deal on a Carrier employee he heard on television saying that the jobs wouldn’t leave because Trump would save them. When he learned the employee’s mother was in the audience, he called out to her.
Speaking before Trump, outgoing Indiana Gov. and Vice President-elect Mike Pence lavished Trump with praise for leading the charge to keep the jobs in the state, referring to his own role in the negotiations as “small.”
He blamed the Obama administration for Carrier’s decision to move, saying he was unable to convince the company to stay during a March conversation.
“The simple truth was that policies coming out of our nation’s capital were literally driving jobs out of this country,” Pence said.
“The American people voted for change last month and even before taking office, our president-elect provided real leadership that made the difference. President-elect Donald Trump did just what he said he would do — he picked up the phone.”
Greg Hayes, CEO of United Technologies, said they were convinced to stay in Indiana after discussions with Trump and Pence about their plans “to improve the competitiveness of the U.S. business environment through tax reform and through a more thoughtful approach to regulation.”
“Those plans have given us a renewed confidence in the future of manufacturing here in the United States,” Hayes said.
Trump suggested he might call other companies to try to seek them to keep jobs in the U.S.
“They say its not presidential to call up these massive leaders of business. I think its very presidential. And if its not presidential, that’s okay because I actually like doing it,” he said. “We will have a lot of phone calls made to companies when they say they are thinking about leaving this country, because they are not leaving this country.”
Some economists and Democrats have downplayed the importance of Trump’s actions.
White House spokesman Josh Earnest said Thursday that while the Carrier deal is “obviously good news,” he emphasized that “Mr. Trump would have to make 804 more announcements just like that to equal the standard of jobs in the manufacturing sector that were created in this country under President Obama’s watch.”
Sen. Bernie Sanders (I-Vt.) argued that the move could set a dangerous precedent.
“In essence, United Technologies took Trump hostage and won…And that should send a shock wave of fear through all workers across the country,” Sanders wrote in an op-ed in the Washington Post. “
“Instead of a damn tax, the company will be rewarded with a damn tax cut. Wow!,” Sanders added.
“How’s that for punishing corporations that shut down in the United States and move abroad?”
But even Democrats agree that the deal is great politics for Trump, whose entire campaign hinged on the promise of an “America First” approach to jobs and the economy.
Jared Bernstein, a liberal economist who served in the Obama administration, called the Carrier deal “pretty brilliant politics” and it’s “great for the folks who can now keep their jobs” even if its not a “sustainable way to adapt to the pressures of globalization.”