‘Trump’s victory leads to outsourcing jobs’ – warns Sanders

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PRESIDENT-ELECT Donald Trump may be touting his deal with heating and ventilation systems manufacurer Carrier as a triumph for working-class Americans, but Vermont Sen. Bernie Sanders is hearing none of it.

‘Today, about 1,000 Carrier workers and their families should be rejoicing,’ Sanders wrote in a Thursday op-ed for The Washington Post. ‘But the rest of our nation’s workers should be very nervous.’

Sanders proceeded to point out what Salon’s Gary Legum had noticed earlier on Thursday – namely, that Trump’s deal saved fewer than half the manufacturing jobs that Carrier was planning to ship to the Mexican city of Monterrey and did so only by having Gov. Mike Pence (in his final weeks as Indiana leader) offer Carrier tax breaks that will cost Indiana $700,000 annually for an indefinite period.

Trump also seemed to promise that his planned tax and regulatory reforms will amount to more savings for Carrier. Yet even after all of this, Carrier is keeping just 850 manufacturing jobs in Indiana. Roughly 1,300 others are still heading to Mexico.

After reviewing these facts, Sanders arrived at a sobering conclusion. ‘Trump has endangered the jobs of workers who were previously safe in the United States,’ Sanders wrote. ‘Why? Because he has signaled to every corporation in America that they can threaten to offshore jobs in exchange for business-friendly tax benefits and incentives.

‘Even corporations that weren’t thinking of offshoring jobs will most probably be re-evaluating their stance this morning. And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America.’

• Carrier’s parent company, United Technologies, announced, in February, that it would be eliminating 2,100 jobs: 1,400 at Carrier and 700 at United Technologies Electronic Controls. Sanders criticised the apparent terms of the deal to save roughly 1,000 American jobs, which includes about $7 million in tax breaks in a multi-year deal with the state of Indiana.

‘The incentives offered by the state were an important consideration,’ Carrier wrote in a statement on Wednesday. The former Democratic presidential candidate said this sets a dangerous precedent, in which corporations can take advantage of the new president-elect by threatening to outsource jobs, to receive their own tax cut. Sanders is not alone in this belief.

Justin Wolfers, a professor of economics and public policy at the University of Michigan, tweeted, ‘Every savvy CEO will now threaten to ship jobs to Mexico, and demand a payment to stay. Great economic policy.’

During his campaign, Trump said he would make Carrier ‘pay a damn tax,’ but Sanders said despite Trump’s pledge to be tough on corporate America, the president-elect seems to be doing the exact opposite. After striking the deal with Carrier, Trump tweeted that it was a ‘Big day on Thursday for Indiana.’

‘We will keep our companies and jobs in the US Thanks Carrier,’ he wrote. Sanders wrote about his own plans to prevent jobs from being outsourced to other countries, in the form of proposed legislation, called the Outstanding Prevention Act. President-elect Donald Trump will reportedly announce a deal with United Technologies, the corporation that owns Carrier, that keeps less than 1,000 of the 2,100 jobs in America that were previously scheduled to be transferred to Mexico.

‘Let’s be clear: 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 iron-clad contract is signed to ensure that all of these workers are able to continue working in Indiana without having their pay or benefits slashed.

‘In exchange for allowing United Technologies to continue to offshore more than 1,000 jobs, Trump will reportedly give the company tax and regulatory favours that the corporation has sought. Just a short few months ago, Trump was pledging to force United Technologies to ‘pay a damn tax.’ He was insisting on very steep tariffs for companies such as Carrier that left the United States and wanted to sell their foreign-made products back in the US.

‘Instead of a damn tax, the company will be rewarded with a damn tax cut. Wow! How’s that for standing up to corporate greed? How’s that for punishing corporations that shut down in the United States and move abroad? In essence, United Technologies took Trump hostage and won. And that should send a shock wave of fear through all workers across the country.

‘Trump has endangered the jobs of workers who were previously safe in the United States. Why? Because he has signaled to every corporation in America that they can threaten to offshore jobs in exchange for business-friendly tax benefits and incentives. Even corporations that weren’t thinking of offshoring jobs will most probably be re-evaluating their stance Thursday morning.

‘And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America. Let’s be clear. United Technologies is not going broke; last year, it made a profit of $7.6 billion and received more than $6 billion in defence contracts. It has also received more than $50 million from the Export-Import Bank and very generous tax breaks. In 2014, United Technologies gave its former chief executive Louis Chenevert a golden parachute worth more than $172 million.

‘Last year, the company’s five highest-paid executives made more than $50 million. The firm also spent $12 billion to inflate its stock price instead of using that money to invest in new plants and workers. Does that sound like a company that deserves more corporate welfare from our government?

‘Trump’s Band-Aid solution is only making the problem of wealth inequality in America even worse. I said I would work with Trump if he was serious about the promises he made to members of the working class. But after running a campaign pledging to be tough on corporate America, Trump has hypocritically decided to do the exact opposite. He wants to treat corporate irresponsibility with kid gloves.

‘The problem with our rigged economy is not that our policies have been too tough on corporations; it’s that we haven’t been tough enough. We need to re-instill an ethic of corporate patriotism. We need to send a very loud and clear message to corporate America: The era of outsourcing is over. Instead of offshoring jobs, the time has come for you to start bringing good-paying jobs back to America.

‘If United Technologies or any other company wants to keep outsourcing decent-paying American jobs, those companies must pay an outsourcing tax equal to the amount of money it expects to save by moving factories to Mexico or other low-wage countries. They should not receive federal contracts or other forms of corporate welfare.

‘They must pay back all of the tax breaks and other corporate welfare they have received from the federal government. And they must not be allowed to reward their executives with stock options, bonuses or golden parachutes for outsourcing jobs to low-wage countries.

‘I will soon be introducing the Outsourcing Prevention Act, which will address exactly that. If Donald Trump won’t stand up for America’s working class, we must.’