Trump "punishes" Carrier by giving them $7 million tax deal

Anonymous (User Deleted) | Legendary Invincible!
 
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Carrier wants to move jobs from Indiana to Mexico to save money. Trump said he wasn't going to let that happen. To help the president-elect accomplish his agenda, Bernie Sanders introduced a protectionist anti-outsourcing bill.

Trump blew off Congress completely. Carrier's """""penalty""""" will be a $7 million tax cut, and we're still losing half the jobs anyway. It's a deal so blatantly crony capitalism that it makes Sarah Palin sound competent.

http://www.stltoday.com/business/local/carrier-gets-tax-breaks-but-it-s-still-sending-jobs/article_d2f958e5-1eaf-5401-93b1-c6b0990acab2.html

Update: The jobs saved will ultimately be replaced by automation.
Quote
Carrier gets tax breaks, but it's still sending 1,300 jobs to Mexico

Reuters
Dec 1, 2016

Updated at 4:33 p.m.

WASHINGTON • Indiana state officials have agreed to give United Technologies Corp. $7 million worth of tax breaks to encourage the company to keep at least 1,069 jobs at its Carrier unit in Indianapolis, Carrier and the state said on Thursday.

President-elect Donald Trump has claimed credit for keeping well-paid manufacturing jobs in the country, but the deal is less than a complete victory for the Republican who campaigned on "putting America first."

In the election campaign, Trump vowed to impose hefty tariffs if Carrier did not reverse course on shifting jobs to Mexico. The deal means Carrier will still send an estimated 1,300 jobs there.

United Technologies chief executive Gregory Hayes said at an event that the company will invest more than $16 million over two years to keep its Indianapolis plant in the state.

The Indiana Economic Development Corp. said it has offered Carrier $5 million in conditional tax credits based on a plan to retain 1,069 jobs with an average wage of $30.91 per hour, spokeswoman Abby Gras said.

She declined to say how many of those jobs are at the plant or at the company's headquarters, but the Wall Street Journal reported the deal would save about 800 of the 1,400 jobs at the plant and about 300 at the headquarters.

Indiana is also offering $1 million in training grants to support workforce development and $1 million in tax credits, Gras said. The agreement has not been finalized yet.

Some other details of the deal in Vice President-elect and Indiana Governor Mike Pence's state were unclear but it has already been criticized on the left and right.

Trump and Pence celebrated the 1,000 jobs deal at an event in Indianapolis on Thursday, but employers elsewhere in Indiana are laying off five times as many workers because of foreign competition.

Trump "did just what he said he would do," Pence said, recounting his push to convince Carrier to remain in Indiana. "He made the case for America."

Neither Trump nor Pence made any reference to United Technologies' planned job cuts in Indiana.

U.S. Sen. Bernie Sanders of Vermont, who lost the Democratic presidential primary to Hillary Clinton, wrote in a Washington Post op-ed that "it is not good enough to save some of these jobs. Trump made a promise that he would save all of these jobs, and we cannot rest until an ironclad contract is signed to ensure that all of these workers are able to continue working in Indiana."

Republican Representative Justin Amish of Michigan tweeted: "Not the president(elect)'s job. We live in a constitutional republic, not an autocracy. Business-specific meddling shouldn't be normalized."

Reuters reported earlier this week that United Technologies would still would proceed with plans to close its Huntington, Ind., United Technologies Electronic Controls plant that employs 700.

Trump also faces pressure to prevent other job cuts. There are several other factories in Indiana that closing and Senator Joe Donnelly, a Indiana Democrat, urged him to take action to prevent other job losses. The United States has shed about 5 million manufacturing jobs since 2000. Indiana alone has lost about 150,000 factory jobs since 2000 to about 500,000.
Last Edit: December 12, 2016, 11:54:22 AM by Kupo & the Two G-strings


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Disregarding the larger implications of a president-elect attempting to negotiate influence business deals, here are some observations:

-$7M is pocket change in a state's budget and to the company's coffers
-Trump claimed credit for the deal not because he had any part in it (every article I've read states the deal was made by the state of Indiana), but because it reinforces the rhetoric he gave about the incident
-Math:
Cost to company: 1,069 jobs * $30.91/hr * 40 hours per week * 52 weeks per year + $0 of benefits factoring in = $68,729,003.2
Tax break: $7M
Promised company investment in the state: $16M
Net loss for the company (obviously not including the value of the workers): $-77,730,000

And the income tax from that $68.7M in salaries brings back another $2.2M alone, let alone property and sales taxes. The company's actually getting fucked from this deal, and the state is benefiting. I don't see this is a viable tactic to keep jobs in the country, and it fails to address the underlying cause of inversions or outsourcing.
Last Edit: December 05, 2016, 02:21:31 PM by HubbleTurkeyscope


Anonymous (User Deleted) | Legendary Invincible!
 
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The company's actually getting fucked from this deal, and the state is benefiting.
False. They stood to lose some of their billions in federal contracts by leaving, which was a major factor for their staying here, at least if Trump had put that on the table. Half the jobs are going away regardless. Carrier can take the loss you calculated since they still made over $4 billion last year.

Carrier gets less in taxes, fewer regulations, and zero political consequences for basically saying a few scary words. They got everything they wanted. And as you admitted yourself:
Quote
I don't see this is a viable tactic to keep jobs in the country, and it fails to address the underlying cause of inversions or outsourcing.
There's no guarantee this will work for the longer term.
Last Edit: December 05, 2016, 03:00:33 PM by Kupo & the Two G-strings


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They stood to lose some of their billions in federal contracts by leaving, which was a major factor for their staying here, at least if Trump had put that on the table.

I'm very confused about what you think would have been a fair outcome. You and I have both expressed that the tax break is a drop in the bucket. Whether this was merely an attempt to stay in good graces with Trump for defense contracts is uncorroborated. The fact that they got "less taxes" is irrelevant; they're getting a net loss. And "fewer regulations"? What are you even referring to?

It's also pretty speculative that this incredibly minor deal could have been used to leverage $6B in contracts. But let me ask you this: if it was, how does that smack of crony capitalism any less than this deal? Because the government would have saved a measly ~$3M?


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They stood to lose some of their billions in federal contracts by leaving, which was a major factor for their staying here, at least if Trump had put that on the table.

I'm very confused about what you think would have been a fair outcome. You and I have both expressed that the tax break is a drop in the bucket. Whether this was merely an attempt to stay in good graces with Trump for defense contracts is uncorroborated. The fact that they got "less taxes" is irrelevant; they're getting a net loss. And "fewer regulations"? What are you even referring to?

It's also pretty speculative that this incredibly minor deal could have been used to leverage $6B in contracts. But let me ask you this: if it was, how does that smack of crony capitalism any less than this deal? Because the government would have saved a measly ~$3M?
Firstly, letting corporations off the hook is pretty much the opposite of what Trump campaigned on. So I'm pretty peeved about that, because it was one of the few policies of his that I agreed with.

Secondly, what kind of message does this send to other companies looking to save some money? Make threats about leaving if you want lower taxes and fewer regulations and still be able to ship half the jobs overseas anyway? It sets a terrible precedent for the next four years. This was an opportunity to impose tougher penalties for taking away American jobs, and Trump caved in to Carrier's desires.

Thirdly, however small the tax cut is, however specific this deal is to the circumstances, it's still $7 million out of taxpayers' pockets.

Fourthly, this is not a sustainable tactic and could lead to longer term losses for the American people.

Fifthly, Trump acted unilaterally. Trump had the opportunity to craft a long-term solution with Congress, but he blew them off. I'm particularly wary of the executive branch's increasing powers and influence--ignoring Congress sets a bad precedent that's very much in-line with his previous autocratic statements during the campaign trail.
Last Edit: December 05, 2016, 03:27:24 PM by Kupo & the Two G-strings


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what kind of message does this send to other companies looking to save some money? Make threats about leaving if you want lower taxes and fewer regulations and still be able to ship half the jobs overseas anyway?
This is the reality of the economy in the country, though. They don't have to threaten anything; companies do this naturally. And I'm not sure why I need to restate this, but Carrier didn't actually gain from staying -- how could they, if this was a pittance to appear favorable to the government?
Quote
Fifthly, Trump acted unilaterally. Trump had the opportunity to craft a long-term solution with Congress, but he blew them off.

Where is the evidence that Trump actually had any part in this? And why on Earth would Congress have any business strong-arming a company into staying in the country at a significant loss? Trump isn't even president yet, how is he supposed to be crafting a solution to anything right now?


PSU | Legendary Invincible!
 
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Yawn, take a multinational business finance course.

This is how deals are done. Trump has done more in 4 weeks than Obama has done in 8 years.


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Bernie Sanders introduced a protectionist anti-outsourcing bill.
Don't the republicans still control both houses of congress? I don't see why they would give this proposal much thought, especially since "starve the beast" appears to still be in full swing.


 
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This is how deals are done. Trump has done more in 4 weeks than Obama has done in 8 years.

I could eviscerate you with a multi-paragraph post with numerous sources, statistics and personal narratives. But you'd just come back and shout about bias or some shit.

So I'll just no, no he hasn't.

Bernie Sanders introduced a protectionist anti-outsourcing bill.
Don't the republicans still control both houses of congress? I don't see why they would give this proposal much thought, especially since "starve the beast" appears to still be in full swing.

It's for credit claiming on the Democrats part. There's barely a chance in hell Republicans will even take a look at the legislation, and less of a chance that it ever is passed.

This allows them to turn around and say "Look constituents, Republicans say they want to protect your jobs but they didn't even vote on this bill!"

Both parties at any level of government do it.
Last Edit: December 05, 2016, 05:57:59 PM by Icy


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I'd rather have the multi paragraph answer cause Obama has done literally nothing except hurt America


 
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Ah yeah. The "Never, Always" is so great in debates.

Not one good thing has come out of the federal government in the past eight years, nothing has been done that has improved the lives of some group of people, some community.

Keep telling yourself that. 
Last Edit: December 05, 2016, 06:12:11 PM by Icy


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Ah yeah. The "Never, Always" is so great in debates.

Not one good thing has come out of the federal government in the past eight years, nothing has been done that has improved the lives of some group of people, some community.

Keep telling yourself that.

The federal government? No
State governments? Absolutely


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He still saved several hundred jobs.


Anonymous (User Deleted) | Legendary Invincible!
 
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what kind of message does this send to other companies looking to save some money? Make threats about leaving if you want lower taxes and fewer regulations and still be able to ship half the jobs overseas anyway?
This is the reality of the economy in the country, though. They don't have to threaten anything; companies do this naturally. And I'm not sure why I need to restate this, but Carrier didn't actually gain from staying -- how could they, if this was a pittance to appear favorable to the government?
Quote
Fifthly, Trump acted unilaterally. Trump had the opportunity to craft a long-term solution with Congress, but he blew them off.

Where is the evidence that Trump actually had any part in this? And why on Earth would Congress have any business strong-arming a company into staying in the country at a significant loss? Trump isn't even president yet, how is he supposed to be crafting a solution to anything right now?
I dunno, man. After reading into it some more, I don't know if it's really all that bad for the US. Subsidies are a valid maneuver for keeping jobs, within reason. You may be right that Carrier got the raw end of the deal here. But I'd be a lot less skeptical if Trump had used the opportunity to craft a longer term plan.

As for Trump acting unilaterally, that's been the implication from virtually every news report on the matter and from Trump and his team. But it may be a moot point.
Last Edit: December 06, 2016, 06:21:36 PM by Kupo & the Two G-strings


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Trumps deal was nothing of importance. Although it delayed the jobs leaving well some of them it really ended up becoming a saving for Carrier. Carrier won a pr move by saying they are keeping jobs in America although in reality they just outsourced half the jobs whole at the save time cut costs by outsourcing their Labour to Mexico. Expect this to occur more often, as Labour cost becomes one of the most expensive parts of any corporate spreadsheet. It's the main thing that will have to be pushed down.

Also anyone saying Obama did nothing for the last eight years, can basically thank the Congress for blockade g every move he did. Yes the ACA was not a great deal and should have been perfected, but the Congress has been the most abysmal body to exist. No offense the Republicans have kind of helped in ruining America under Obama by undermining his authority and digging deeper into this partisan bulls hit. Mind you the Democrats have done it as well but the Republicans are more guilty of this crime. Blockading bills that Obama was trying to pass to keep jobs and pushing bills to undermine the Democrats although they were horrible. Just look at the 9/11 Bill they passed. Obama vetoed it once the Republicans ignored it and forced it through ignoring why Obama said it was a bad bill and then when passed complained about Obama not telling them and clarifying for them the bill was bad.

Also to be honest state governments have also been shit in America. Weirdly enough the best states are those that although are conservative have liberal tax policies as well. Many states are going to shit unless you are part of the states that are the economic powershouses like California, the states that comprise the NE United States, Texas. Weirdly enough the locations that make the most money are also Weirdly enough more liberal than the Republican party although they should be considered centrist. Why is there no progressive conservative parties in America? And don't get me started on the districts, that should be run by an independent federal body like the IRS.

But what do I know, I am from Canada, the country that was able to decrease its debt by doing something the Americans have never considered. Cutting spending and raising taxes at the same time.

Sent from my ONE A2005 using Tapatalk
Last Edit: December 11, 2016, 05:53:17 PM by Risay117


Anonymous (User Deleted) | Legendary Invincible!
 
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Some of the jobs "saved" will ultimately be replaced by robots.