Um, Donald Trump's Carrier Jobs Deal Isn't What It Sounds Like
Donald Trump would have you believe that he alone is the savior of the American economy, American jobs, and that America from some time in the past when everything was great for white people in the Midwest. That's at least a big part of what sealed the deal for the voters who pushed him over the finish line in places like Wisconsin, Michigan, and Pennsylvania. But can he actually deliver? In his first PR coup, Trump took credit on Twitter for saving about 1,000 jobs at Carrier in Indiana. But Trump's Carrier jobs deal isn't all that great.
There are two ways to look at this, and prove Trump to be neither the world's greatest negotiator nor a job savant. But let's take a look. One way to judge this deal would be to compare it to the ones generally given by state and local governments. Is this better? Is it worse? We really don't know. All we have to go off of is Carrier's announcement, and it's pretty minimal on details. That could be to make it look like Trump played a bigger role than he did. Instead, it could be the soon-to-be vice president, Indiana Gov. Mike Pence, who made the deal happen with state offers.
In fact, the company acknowledged that "the incentives offered by the state were an important consideration" in their decision to stay. On top of these mystery incentives, which could cost taxpayers far more than these jobs provide to the economy, the deal didn't even save all of the jobs. Perhaps just as few as 800 of 1,400 jobs were saved, according to some news reports. Fox news, for example, posted this headline: "Hundreds could still lose jobs at Carrier's Indianapolis plant, despite Trump deal."
As New York Times columnist Justin Wolfers (also an economics professor) points out, this could just lead lots of other manufacturers to push for similar demands. Not very sustainable if we want any sort of tax base. Which brings me to the next point: Are any of those deals worth it? Most economists would say no, they're not. Often, tax deals are not so much meant to keep jobs in the U.S., but rather to prevent them from moving across state lines, which doesn't help the American economy at all.
This company is at least within the country, but Fortune pointed out that it's not old companies that are job creators, but rather new start-ups. Just read what they wrote about the Trump-Carrier deal: "These inducements often are just acts of lavishing tax breaks on companies that don’t need them, and don’t have the most potential for creating new jobs."
So this type of deal is generally not good, and this one could be really bad. We just don't know yet. What is clear is that Trump is going to milk it for all he can, and we shouldn't let him. His conflicts of interest and appointments — including Wall Street insiders — are far more worrisome. They need to garner more of our attention. After all, another smaller reason Carrier is staying is that "the incoming Trump-Pence administration has emphasized to us its commitment to support the business community." That's more money for the top 1 percent and corporations, and likely not so much for you.