Sanders Provides Correct Response To Trump's Carrier Deal

Trump's announcement of a "deal" with Carrier Corporation to keep "close to 1,000" jobs from moving to Mexica is surely a PR coup for the President-elect and the media, accordingly, has been somewhat fawning while exploring the lack of details on the incentives given. In reality, this is a pretty large failure for Trump when you actually look at the specifics that have been revealed.

First of all, some 1,300 jobs will still be going to Mexico under this deal and it appears that only 800 jobs at the Indiana factory will have actually been "saved". It is unclear whether that number of 800 includes 400 jobs that Carrier had already agreed would still stay in Indiana. So it is quite possible that Trump's "deal" really only saved 400 jobs. Now those jobs mean everything to those that have them and it is undoubtedly a good thing. In addition, it is also unclear whether the remaining employees will be asked to take a pay cut. The head of the union representing the Carrier workers is saying that he expects that to happen.

At least part of the incentive for Carrier to keep these jobs was $700,000 in tax breaks from the state of Indiana. Hopefully, someone from the press will ask Mike Pence why it took until now for the state to offer those incentives, if that would actually keep the jobs in Indiana. The more likely reality is that Trump gave Carrier's parent company, United Technologies (UTC), certain promises of roll backs of regulations and business taxes. UTC is a major federal contractor.

Bernie Sanders had the proper Democratic response to this announcement in an op-ed piece in today's Washington Post. Sanders points out that Trump is only saving some of the jobs in Indiana, not ALL of the jobs as he had promised. In addition, Sanders reiterates that we still don't know if the remaining employees will be subject to wage and benefit cuts. As many economists have pointed out, this kind of deal actually encourages companies to announce an offshoring of jobs and then hope to renegotiate a special deal with the Trump administration. That should make every worker in America fearful. But the most important point that Sanders makes is that Trump promised to institute some sort of levy to keep the jobs in Indiana. It was either going to be a tariff on goods coming from Mexico or some sort of tax on companies who outsource. But Trump has actually done the opposite by giving the company a tax break. UTC made billions in profits last year and pays its top executives in the tens of millions of dollars each year. But Trump gave them a tax break to save only a portion of the jobs in Indiana that he said he would. As Sanders says, "who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America." Sanders proposes what Trump would not do - an outsourcing tax equivalent to the company's savings by moving offshore, the clawback of tax breaks and incentives related to the jobs being moved, and making the company ineligible for federal contracts. Please read his entire editorial.

Now, Sanders' proposals will be attacked for a variety of reasons, primarily because they will described as economically unfeasible and will only raise the cost of goods for consumers. But let's be serious. Democrats are in opposition and the chances of any Democratic proposals becoming law are nil. Republicans have shown quite clearly that you can get away with a post-policy, post-truth agenda for years. More importantly, Sanders stance is a signal to the working class the Democrats really care about saving their jobs. And he makes the critical point that companies are actually being rewarded for threatening to offshore jobs, essentially rewarding bad behavior. That is the theme that Democrats must hammer home to the working class. Democrats will not reward bad behavior. Democrats will not reward companies who threaten to kill American jobs. At a visceral level, people will understand that moral stance of not rewarding bad behavior. And the working class will understand the Democrats are really interested in saving American jobs. I hope that the Democratic leadership will join Sanders in this stance because now, more than ever, Democrats need to speak with one voice.

And, finally, when the dust settles and we actually find out what kind of agreement Trump has really made with Carrier and UTC, the press will actually talk to those workers who ended up losing their jobs and those workers who kept their jobs but with probably reduced pay and find out whether or not they feel betrayed by Trump. I think we will find a stark difference between what Trump said in his announcement and what actually happened to those workers.