The details are fuzzy on Donald Trump’s deal to save 1,000 (or is it 800?) Carrier air conditioner manufacturing jobs from outsourcing, but the picture that’s emerging is not a confidence-inspiring one. The state of Indiana is paying for the jobs with a big tax incentive package, which isn’t unusual at all. In fact, such incentives are so common that one Donald Trump took the time to rail against them on the campaign trail repeatedly.
"Over the years, I've watched, for years, for 10 years, for 12 years, for 15 years, beyond Obama, and I've watched as politicians talked about stopping companies from leaving our states," Trump said. "Remember, they'd give the low-interest loans. Here's a low-interest loan if you stay in Pennsylvania. Here's a zero-interest loan. You don't have to pay. Here's a this. Here's a tax abatement of any kind you want. We'll help your employees. It doesn't work, folks. That's not what they need. They have money. They want to go out, they want to move to another country, and because our politicians are so dumb, they want to sell their product to us and not have any retribution, not have any consequence. So all of that's over."
But if it’s so common, why hadn’t Indiana Gov. Mike Pence offered Carrier tax incentives before now? Well, he had.
But John Mutz, a former Indiana lieutenant governor who sits on the [Indiana Economic Development Corporation’s] 12-member board, told POLITICO that Carrier turned down a previous offer from IEDC before the election. He said he thinks the choice is driven by concerns from Carrier’s parent company, United Technologies, that it could lose a portion of its roughly $6.7 billion in federal contracts.
“This deal is no different than other deals that we put together at the IEDC to retain jobs, but the fact is that the difference is that United Technologies depends on the federal government for lots of business,” Mutz said.
“The major factor that’s changed is we had an election,” Mutz said.
Trump did talk about “retribution” for companies taking jobs overseas. So it seems the choice, at least implicitly, was “take this giant pile of money to only move half as many jobs to Mexico, or the president-elect will hold a grudge come contracts time.” If President Obama suggested an executive order making this kind of threat policy, as opposed to private deal-making, House Republicans would pass a resolution of disapproval and the Chamber of Commerce and five other business lobby groups would sue to block it. And if it was policy, it would be evenly applied, not done the Trump way—in secret to generate good headlines with no transparency on what’s actually going on. The media is going to have to learn that if it’s done in secret with no transparency, the good headlines should probably be put on hold. (I'm looking at you, CNN.)