Thursday, December 1, 2016
Indiana Taxpayers to Pay Dearly to Save 800 Carrier Jobs, While Company Still Sends 1300 to Mexico
Donald Trump held a rally in Indianapolis today to take a victory lap, a celebration of a deal he and Vice President-Elect and current Indiana Governor Mike Pence reached to keep Carrier from moving its operations from Indianapolis to Mexico. Trump claims that the deal shows there will be
The 10 year deal to keep Carrier in Indianapolis will cost Hoosier taxpayers $7 million. While saving 800 jobs in Indianapolis, Carrier still plans to move 600 of those 1,400 Indianapolis jobs to Mexico. Add to that another 700 jobs at a separate Huntington, Indiana plant that is relocating to Mexico and Indiana is still losing 1300 Carrier jobs to Mexico at the same time the company is receiving a big pile of taxpayer money.
Although Candidate Trump threatened "the stick" of a special tariff against particular companies that move operations to other countries and then sell goods back to the U.S., the fact is as President he can't legally do that. So instead President-Elect Trump resorted to good old fashioned bribery.
There is a name for the Trump-Carrier deal. It is called corporate welfare, i.e. crony capitalism. Government should ever be in the business of picking winners and losers in a capitalist system. To do so is a distortion of the free market which hurts consumers and ultimately workers. Further, the Carrier deal tells the CEO of every company that the government will give them money to stay in the United States if they threaten to outsource jobs. The Carrier deal sets a horrible precedent that will cost American taxpayers dearly in the years to come. It is not to be celebrated.