Doug:
What do you make of Trump's Carrier deal?
David:
Keeping jobs in America. That's what he promised to do. Now, he's doing just that. That's a good thing, right?
Doug:
But not at any cost. It seems that Trump has proposed giving Carrier a 7.5 million dollar tax break in order to keep them from leaving. That sounds like "crony capitalism" and "corporate welfare" to some. Isn't that the opposite of what he was saying when he threatened Carrier with a 35% tariff?
David:
No.
Crony capitalism is using your power to make special deals for your friends and donors. In this instance, Carrier was leaving the country and taking all of their jobs to Mexico. The reasons they gave were high taxes, over regulation, and the high costs of labor. Those jobs were leaving right now. To save those jobs, a deal was struck to alleviate those overhead costs. In other words, if the government is going to create an environment that forces companies to move elsewhere, then the government can ease that burden. But the economy is a fluid dynamic. Once taxes are cut, and unnecessary regulations are lifted, other companies will lose the incentive to move. Deals are being made right now, because they need to be made right now. But that will not always be the case.
The tariff threat is for companies that do move out. If you take jobs from Americans, you will pay a penalty trying to move those goods produced outside of the country back in. The message is that you should just stay here in the first place. And Trump is still making that same threat.
Doug:
Then you disagree with Sarah Palin. But wouldn't it be better to treat all companies the same, rather than picking some that get rewarded with tax breaks and others that don't? Otherwise, isn't the government picking and choosing winners? Weird... I'm actually agreeing with Sarah Palin, and you are disagreeing with her. The world turned upside down.
David:
Economics is complicated with many variables, and it leaves much room for variations in opinions. There are so many variables that continually change that there probably is no completely right answer to a lot of issues. And yet, people get very heated up and insist they have the only "right' answer. Unlike us....
Doug:
It looks like Carrier threatened to move jobs out of the country, and in response it got a tax break. Won't all companies start threatening to move jobs out of the country? It doesn't seem like this is what we want politics to be. Unless this is really about the drama, the excitement of the "deal." Perhaps this deal makes a better sound bite than it makes policy.
David:
Trump isn't even the president yet. As I said, Deals are being made right now to save jobs in the best way possible right at the moment. As the dynamics change, different deals will likely be made. Companies already ask for tax breaks, and compete with different states and cities for the best deal to build companies or factories. That's not new. You make it sound as though Trump invented the idea.
Doug:
But the future does not look good for employees of Carrier, and doesn't look like the tax breaks will be a good payoff for Indiana taxpayers. Carrier has said that it will invest 16 million dollars into the plant. That will mean more automation, resulting in losing some of those same jobs. So Trump is actually giving them money to automate more jobs.
David:
Seven million dollars to keep a thousand people working is a great deal for Indianapolis and Indiana. Not paying anything would be better for sure, but the economy needs people with jobs to spend money to stimulate the economy. All of those people losing their jobs create a burden on taxpayers and the economy.
You sound so sad for these employees, and yet you support raising the minimum wage, which studies show does lead to more automation and the loss of jobs. Not all of the jobs at Carrier will be kept, and that information was part of the original announcement. I'm still glad that a thousand Hoosiers will still be working in Indiana, rather than joining the unemployment lines due to bad policies followed by the past administration.
Doug:
I am sad for those employees that lose their jobs. I am also sad for anyone who works but doesn't make enough money to live on, while their CEOs make millions of dollars. Raising minimum wages does not lead to automation. Automation is a natural progress of industrialization. And it isn't 1,000 employees---it is 730, with 700 still heading to Mexico.
David:
Which is it? Is Carrier using their money to eliminate jobs, or is automation a natural progression that has nothing to do with this conversation? Raising the minimum wage directly leads to more automation and job losses.
Doug:
I don't know why you think that the natural progression doesn't have anything to do with this conversation. It has everything to do with this issue, and Trump can't stop this progression. Carrier knows that. Trump knows that. Everyone knows that. (Oh, and the raising minimum wage makes a stronger economy, regardless of what blog you cite.)
David:
Go tell it to the kiosk at the fast-food place. I'm sure it will listen to your argument much better than the worker it replaced when that worker became more expensive than the machine. Maybe it will be programmed to show empathy.
Doug:
It isn't an argument, but just a fact: jobs change over time. Thinking that you can argue against that fact is wishful thinking. The last election was also based on such wishful thinking by many people.
David: Your mixing up some numbers, which is easy to do as the national media has also been pretty careless with their tabulations. There are 1,000 out of an original 1,400 jobs saved at the Indianapolis plant, which is the only thing Trump and Pence were talking about. There is a separate Carrier plant in Huntington, Indiana that will lose 300-350 jobs that are still moving to Mexico.
Doug:
As WTHR reports: 730 jobs at that plant will stay, and 700 from another plant will be lost.
And you didn't mention Sarah Palin's complaints about the government picking winners and losers. For example, you didn't mention that another company just down the road from Carrier wants a deal. This is interesting from our perspective because this company, Rexnord, has its Indiana plant on the old Blank Homestead:
Our Blank ancestors bought the farm (so to speak) on Rockville Road in the 1850's. It was from this farm that one of the daughters (Katherina Blank) used to go into the big city (Indianapolis) and work as a waitress. She met her husband there, and had children and grandchildren, one named Kurt Vonnegut, Jr.
Should Rexnord get a deal to save their plant too? At what cost? At any cost? Drama! Theater!
David:
Indiana has been trying to make a deal to keep Rexnord just where it is, on the old Blank homestead. The difference here seems to be that Carrier was based in Indianapolis, and is a local company that really wanted to make a deal to stay, but was having trouble financially justifying staying here. Rexnord is based in Milwaukee, Wisconsin, and doesn't have the local ties to Indy. All states are currently trying to make these types of deals. Once the corporate tax rates are decreased (from one of the highest in the world) and regulations are decreased, it will be an easier task. It's not drama, just financial reality.
Doug:
Those are Indiana jobs being lost. Why is one set of lost jobs "financial reality" and the other worth saving? It is really like a soap opera... one has no idea what will happen, nor why. Perhaps the King will grant your company a wish, if you ask nicely.
David:
All jobs are worth trying to save. Not all of them will be saved.
Carrier attributed the better climate for businesses as the main reason they're staying:
Here is a weird opinion I've never heard before: "Rev. Franklin Graham told CNN’s Carol Costello that he backs President-elect Donald Trump’s plan to bring back manufacturing jobs because people are not proud of modern jobs in computer science."
What? Four out of ten of the hottest jobs (if you have a Bachelor's degree) are in computing. “They don’t want to be a computer programmer!” Graham continued. “They want to do the same job as their fathers and their grandfathers. There was pride in the manufacturing and the building. And we’ve taken all that away and it’s sad.” Is this some new class warfare? Some new identity politics?
The other weird aspect of this story is that President-Elect Trump has tweet-attacked Chuck Jones, the president of the union at Carrier:
Jones has only tried to keep even more of the jobs in Indiana. It doesn't seem useful to complain about Jones for doing his job. Unless this is all about the drama.
David:
I don't know what Graham is talking about, exactly. It is sad that entire communities in coal country have been put out of business by President Obama. He stated at the outset that he planned to bankrupt the coal industry, and has largely been successful. Thousands of families lost their livelihoods which were based on decades of family traditions. Technology is the wave of the future, and many would certainly like to be a part of that developing business sector. But it's not for everyone.
Doug:
Obama killed the radio star! I don't think the government should be picking coal mining over computer programming. But maybe there is a role for Graham in Trump's cabinet.
David:
If I made a deal to save jobs that were all going to be lost, and a union official starts ranting that I'm a loser because I didn't save all of the jobs, I'd have a few words to say, too. The United Steelworkers Union didn't save those jobs. Chuck Jones didn't save any jobs. He lost them all. If the best deal you can make on behalf of the workers you represent is to get them all fired, then I agree with Trump - you're doing a terrible job.
Doug:
If I gave you 7.5 million dollars and you "saved" 700 jobs, but only for a short while, then I am a loser, and you made even more money. I feel really bad for all of those workers, especially Chuck Jones. Surely you can understand that he truly cares for those employees and only wants the best for them?
David:
I do agree. His job is to make the best deal for workers. His job is not to get them all fired. He's making the wrong argument by saying this is about the numbers of workers. We might agree that the real issue is Mexico only paying their workers less than $5.00 / hour. How are American workers going to compete with that? It's a much more complicated issue to try to keep plants from relocating. Trump's tariff threat is one of many ways to equal the field (and probably not the best plan).
Doug:
Ah, you begin to understand what Obama has been wrestling with. You want American workers to make enough to live on, but you want American companies to stay here. Well, I don't think the lower end of the wage earners are going to be able to sacrifice any more. If a company's CEO makes a butt load of money, and they move their plant to another country, then they should get no support from our people or government. I would not give them 7.5 million dollars more, unless they showed some serious cuts at the top.
David:
Obama has been wrestling with the issue? What has he done? Nothing. Trump has promised to make changes to lower operating costs, and he has promised to make it more expensive to bring those goods back into the country. Carrot and stick. I don't know if those are all the right moves, but it evens out the playing field a little for companies that are looking to locate or relocate their businesses.
Businesses all across the country are feeling better about the future. The stock market is booming (which means our 401-K's are growing). Even Apple is now talking about building an assembly plant here in the US. I'm certainly happy for the average working men and women who will now have a happy Christmas over at the Carrier plant. I hope Trump is able to save the jobs of more average Americans.
Doug:
I had heard that businesses were people too, my friend, but now you tell me that they can feel? And they are feeling better? Don't know why they were so sad as their profits have been near record highs. Maybe they just want their poor owners and CEOs to be happy too. Trump sure is getting a lot of praise from you for this theater. I don't remember you ever mentioning Obama's work on jobs and employment. With the latest report the economy added 178,000 jobs in November, extending the longest streak of total job growth on record, as the unemployment rate fell to 4.6 percent. That is much better even than what Romney was promising. Obama should take a victory tour.
David:
But using Chuck Jones' argument, he did a lousy job because he could have done better!
I think we can both agree that any time American jobs are created, things are moving in the right direction. There are still many struggles ahead, but let's all pull together to keep the trend going.
What do you make of Trump's Carrier deal?
David:
Keeping jobs in America. That's what he promised to do. Now, he's doing just that. That's a good thing, right?
Doug:
But not at any cost. It seems that Trump has proposed giving Carrier a 7.5 million dollar tax break in order to keep them from leaving. That sounds like "crony capitalism" and "corporate welfare" to some. Isn't that the opposite of what he was saying when he threatened Carrier with a 35% tariff?
David:
No.
Crony capitalism is using your power to make special deals for your friends and donors. In this instance, Carrier was leaving the country and taking all of their jobs to Mexico. The reasons they gave were high taxes, over regulation, and the high costs of labor. Those jobs were leaving right now. To save those jobs, a deal was struck to alleviate those overhead costs. In other words, if the government is going to create an environment that forces companies to move elsewhere, then the government can ease that burden. But the economy is a fluid dynamic. Once taxes are cut, and unnecessary regulations are lifted, other companies will lose the incentive to move. Deals are being made right now, because they need to be made right now. But that will not always be the case.
The tariff threat is for companies that do move out. If you take jobs from Americans, you will pay a penalty trying to move those goods produced outside of the country back in. The message is that you should just stay here in the first place. And Trump is still making that same threat.
Doug:
Then you disagree with Sarah Palin. But wouldn't it be better to treat all companies the same, rather than picking some that get rewarded with tax breaks and others that don't? Otherwise, isn't the government picking and choosing winners? Weird... I'm actually agreeing with Sarah Palin, and you are disagreeing with her. The world turned upside down.
David:
Economics is complicated with many variables, and it leaves much room for variations in opinions. There are so many variables that continually change that there probably is no completely right answer to a lot of issues. And yet, people get very heated up and insist they have the only "right' answer. Unlike us....
Doug:
It looks like Carrier threatened to move jobs out of the country, and in response it got a tax break. Won't all companies start threatening to move jobs out of the country? It doesn't seem like this is what we want politics to be. Unless this is really about the drama, the excitement of the "deal." Perhaps this deal makes a better sound bite than it makes policy.
David:
Trump isn't even the president yet. As I said, Deals are being made right now to save jobs in the best way possible right at the moment. As the dynamics change, different deals will likely be made. Companies already ask for tax breaks, and compete with different states and cities for the best deal to build companies or factories. That's not new. You make it sound as though Trump invented the idea.
Doug:
But the future does not look good for employees of Carrier, and doesn't look like the tax breaks will be a good payoff for Indiana taxpayers. Carrier has said that it will invest 16 million dollars into the plant. That will mean more automation, resulting in losing some of those same jobs. So Trump is actually giving them money to automate more jobs.
David:
Seven million dollars to keep a thousand people working is a great deal for Indianapolis and Indiana. Not paying anything would be better for sure, but the economy needs people with jobs to spend money to stimulate the economy. All of those people losing their jobs create a burden on taxpayers and the economy.
You sound so sad for these employees, and yet you support raising the minimum wage, which studies show does lead to more automation and the loss of jobs. Not all of the jobs at Carrier will be kept, and that information was part of the original announcement. I'm still glad that a thousand Hoosiers will still be working in Indiana, rather than joining the unemployment lines due to bad policies followed by the past administration.
Doug:
I am sad for those employees that lose their jobs. I am also sad for anyone who works but doesn't make enough money to live on, while their CEOs make millions of dollars. Raising minimum wages does not lead to automation. Automation is a natural progress of industrialization. And it isn't 1,000 employees---it is 730, with 700 still heading to Mexico.
David:
Which is it? Is Carrier using their money to eliminate jobs, or is automation a natural progression that has nothing to do with this conversation? Raising the minimum wage directly leads to more automation and job losses.
Doug:
I don't know why you think that the natural progression doesn't have anything to do with this conversation. It has everything to do with this issue, and Trump can't stop this progression. Carrier knows that. Trump knows that. Everyone knows that. (Oh, and the raising minimum wage makes a stronger economy, regardless of what blog you cite.)
David:
Go tell it to the kiosk at the fast-food place. I'm sure it will listen to your argument much better than the worker it replaced when that worker became more expensive than the machine. Maybe it will be programmed to show empathy.
Doug:
It isn't an argument, but just a fact: jobs change over time. Thinking that you can argue against that fact is wishful thinking. The last election was also based on such wishful thinking by many people.
David: Your mixing up some numbers, which is easy to do as the national media has also been pretty careless with their tabulations. There are 1,000 out of an original 1,400 jobs saved at the Indianapolis plant, which is the only thing Trump and Pence were talking about. There is a separate Carrier plant in Huntington, Indiana that will lose 300-350 jobs that are still moving to Mexico.
Doug:
As WTHR reports: 730 jobs at that plant will stay, and 700 from another plant will be lost.
And you didn't mention Sarah Palin's complaints about the government picking winners and losers. For example, you didn't mention that another company just down the road from Carrier wants a deal. This is interesting from our perspective because this company, Rexnord, has its Indiana plant on the old Blank Homestead:
 |
| Right: current Satellite image from Google Maps. Left: Map of old Blank Homestead around 1880. The Rexnord Indiana plant lies directly on the old farm. |
Should Rexnord get a deal to save their plant too? At what cost? At any cost? Drama! Theater!
David:
Indiana has been trying to make a deal to keep Rexnord just where it is, on the old Blank homestead. The difference here seems to be that Carrier was based in Indianapolis, and is a local company that really wanted to make a deal to stay, but was having trouble financially justifying staying here. Rexnord is based in Milwaukee, Wisconsin, and doesn't have the local ties to Indy. All states are currently trying to make these types of deals. Once the corporate tax rates are decreased (from one of the highest in the world) and regulations are decreased, it will be an easier task. It's not drama, just financial reality.
Doug:
Those are Indiana jobs being lost. Why is one set of lost jobs "financial reality" and the other worth saving? It is really like a soap opera... one has no idea what will happen, nor why. Perhaps the King will grant your company a wish, if you ask nicely.
David:
All jobs are worth trying to save. Not all of them will be saved.
Carrier attributed the better climate for businesses as the main reason they're staying:
The company attributed its decision to the incoming Trump administration and financial incentives provided by Indiana, which is something of a reversal, since earlier offers from the state had failed to sway Carrier from decamping to Mexico.
"Today's announcement is possible because the incoming Trump-Pence administration has emphasized to us its commitment to support the business community and create an improved, more competitive U.S. business climate," the company said.
(Quote from FoxNews)
Doug:Here is a weird opinion I've never heard before: "Rev. Franklin Graham told CNN’s Carol Costello that he backs President-elect Donald Trump’s plan to bring back manufacturing jobs because people are not proud of modern jobs in computer science."
What? Four out of ten of the hottest jobs (if you have a Bachelor's degree) are in computing. “They don’t want to be a computer programmer!” Graham continued. “They want to do the same job as their fathers and their grandfathers. There was pride in the manufacturing and the building. And we’ve taken all that away and it’s sad.” Is this some new class warfare? Some new identity politics?
The other weird aspect of this story is that President-Elect Trump has tweet-attacked Chuck Jones, the president of the union at Carrier:
David:
I don't know what Graham is talking about, exactly. It is sad that entire communities in coal country have been put out of business by President Obama. He stated at the outset that he planned to bankrupt the coal industry, and has largely been successful. Thousands of families lost their livelihoods which were based on decades of family traditions. Technology is the wave of the future, and many would certainly like to be a part of that developing business sector. But it's not for everyone.
Doug:
Obama killed the radio star! I don't think the government should be picking coal mining over computer programming. But maybe there is a role for Graham in Trump's cabinet.
David:
If I made a deal to save jobs that were all going to be lost, and a union official starts ranting that I'm a loser because I didn't save all of the jobs, I'd have a few words to say, too. The United Steelworkers Union didn't save those jobs. Chuck Jones didn't save any jobs. He lost them all. If the best deal you can make on behalf of the workers you represent is to get them all fired, then I agree with Trump - you're doing a terrible job.
Doug:
If I gave you 7.5 million dollars and you "saved" 700 jobs, but only for a short while, then I am a loser, and you made even more money. I feel really bad for all of those workers, especially Chuck Jones. Surely you can understand that he truly cares for those employees and only wants the best for them?
David:
I do agree. His job is to make the best deal for workers. His job is not to get them all fired. He's making the wrong argument by saying this is about the numbers of workers. We might agree that the real issue is Mexico only paying their workers less than $5.00 / hour. How are American workers going to compete with that? It's a much more complicated issue to try to keep plants from relocating. Trump's tariff threat is one of many ways to equal the field (and probably not the best plan).
Doug:
Ah, you begin to understand what Obama has been wrestling with. You want American workers to make enough to live on, but you want American companies to stay here. Well, I don't think the lower end of the wage earners are going to be able to sacrifice any more. If a company's CEO makes a butt load of money, and they move their plant to another country, then they should get no support from our people or government. I would not give them 7.5 million dollars more, unless they showed some serious cuts at the top.
David:
Obama has been wrestling with the issue? What has he done? Nothing. Trump has promised to make changes to lower operating costs, and he has promised to make it more expensive to bring those goods back into the country. Carrot and stick. I don't know if those are all the right moves, but it evens out the playing field a little for companies that are looking to locate or relocate their businesses.
Businesses all across the country are feeling better about the future. The stock market is booming (which means our 401-K's are growing). Even Apple is now talking about building an assembly plant here in the US. I'm certainly happy for the average working men and women who will now have a happy Christmas over at the Carrier plant. I hope Trump is able to save the jobs of more average Americans.
Doug:
I had heard that businesses were people too, my friend, but now you tell me that they can feel? And they are feeling better? Don't know why they were so sad as their profits have been near record highs. Maybe they just want their poor owners and CEOs to be happy too. Trump sure is getting a lot of praise from you for this theater. I don't remember you ever mentioning Obama's work on jobs and employment. With the latest report the economy added 178,000 jobs in November, extending the longest streak of total job growth on record, as the unemployment rate fell to 4.6 percent. That is much better even than what Romney was promising. Obama should take a victory tour.
David:
But using Chuck Jones' argument, he did a lousy job because he could have done better!
I think we can both agree that any time American jobs are created, things are moving in the right direction. There are still many struggles ahead, but let's all pull together to keep the trend going.
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