November 30th, 2016

What’s behind the Carrier deal?

Trump’s deal with Carrier to stay in Indiana rather than moving to Mexico is a stroke of PR brilliance. It’s also an example of exactly why Trump is now feared by the left: he is very good at this kind of visual, with populist appeal that used to be their special province.

But inquiring further, what’s it all about, Alfie? What was the quid pro quo?:

Carrier stayed because of government incentives and tax breaks. We don’t know details, but if Indianapolis and the state offered the same breaks to lots of other companies, they’d have to find other ways to raise revenue to pave streets and provide public safety. It is not, in Silicon Valley parlance, scalable.

We don’t know the details. We don’t know how this factors into the larger plan—or if there is a larger plan yet. As my mother used to say almost every time I asked her for something: we’ll see.

19 Responses to “What’s behind the Carrier deal?”

  1. Cornhead Says:

    David Faber of CNBC reports modest state incentives. The big stick here is that Carrier is a sub of big defense contractor UTX.

    But Trump sent a message that Obama or Clinton never could.

  2. Big Maq Says:

    Smells like cronyism, but who knows. It could be all about fear of retribution of one sort or another, instead. Or, maybe, a mix of both.

    We’ll see, just like we’ll see wrt trump separating himself from his business interests, to the point of having a credible “firewall”, but he seems to involve family rather closely with him.

    He surprised us on many things, so maybe he will with this.

    Won’t express too much cynicism as I did give him 100 days after taking office to prove himself, so…

    We’ll see.

  3. J.J Says:

    The business psychology that has come with Trump’s election is quite surprising. The markets are rising. Not on good news about earnings, but on anticipation of good news about pro-business government policy.

    I met with a small business friend this morning. He has been very pessimistic for the last seven years. He was optimistic today. He’s thinking about borrowing some money and expanding. The psychology has turned on a dime.

    I’m not wildly enthusiastic yet. I’ve been out of stocks for the last four years based on my appraisal of the Obama anti-business climate. I’m not going to jump back in with both feet but have a couple of blue chip dividend stocks that I think will do well over the next four years to dip my toe back in.

    I saw Mike pence interviewed by Hannity last night. He was raving about the way things are going. He is to talk to leaders in Congress today. When asked what his message would be, he answered, (paraphrasing) I’m going to tell them to buckle up because it’s going to be 100 days of action like they’ve never seen before.

    As you say, we’ll see.

  4. Big Maq Says:

    @JJ – we’ll see, but it is not too far back we heard “you didn’t build that” and “boot on the neck…”.

    The tone may be changed, but we’ll see if that 100 days of action meaningfully makes a dent in regulations that have a large economic effect, and if so, if it doesn’t add back new ones of its own.

  5. AMartel Says:

    If it’s in Indiana, Pence is probably the one with the insider knowledge capable of putting together a package to induce Carrier to stay put.

  6. parker Says:

    I am going to assume (yes, I know) a typical bag of local and state incentives were involved. This happens all the time as localities and states compete to attract or maintain businesses. TIF are offered in the hopes of long term tax receipts. Sometimes it pays off and sometimes it does not.

    I agree with AMartel, Pence, not Trump, is likely involved in this bit of political gamesmanship.

  7. Dunque Says:

    If, as the Mercury News says, no one knows the details yet, what is the sense of raining on this piece of good news other than to rain?

    I don’t know any details yet either but a sunny side look might say that United Technologies, a major defense contractor and parent of Carrier, understood their access to government contracts might be impacted if the move were allowed.

    As I said, I don’t know any details either. God forbid we actually wait for them and then discuss.

  8. Jim Doherty Says:

    Ummm Carrier is sub to UTX.

    Carrier was gonna save 65m a year in moving those two plants to mexico.

    UTX has something like 54B, <—thats a B, in defense contracts etc.

    Simple arithmatic.

  9. Tom Schaffner Says:

    Trump to UTX: Nice little Defense contracts you have there. Be a shame if anything happened to them.

  10. Lizzy Says:

    ” It is not, in Silicon Valley parlance, scalable.”

    Funny, I recall companies like GE (when they still owned NBC) and Facebook getting HUGE tax breaks under Obama.

  11. Ymarsakar Says:

    Funny, I recall companies like GE (when they still owned NBC) and Facebook getting HUGE tax breaks under Obama.

    Ya think Hussein was so passionate about it he would cancel golfing and fun time to meet with GE and FB?

    Trum is exercising a field command, a tactical decision, using influence he will have in the future. Thinking it scales up to a logistical or strategic level, is why people think they need Trum to fix a dead Republic.

  12. Ymarsakar Says:

    Dunque Says:
    November 30th, 2016 at 5:05 pm
    If, as the Mercury News says, no one knows the details yet, what is the sense of raining on this piece of good news other than to rain?

    It’s about time weaklings complaining about the Left used their own intel networks and intelligence. Start thinking for yourself, instead of raining on other people thinking for themselves.

    Otherwise all you will do with Trum is complain about the media, while sitting around outsourcing all your problems to Trum as your king.

  13. Cornflour Says:

    I’m out of my depth here. I’ve never worked for a large corporation, never worked as a corporate executive, never worked as a bureaucrat or politician granting favors to corporations.

    Still, from the outside looking in, don’t incentives still matter? What will corporate executives learn from this? Threaten to move jobs to Mexico, then wait for Trump to subsidize your business with money from taxpayers.

    I don’t think this is being cynical, just realistic. I guess we’ll see soon enough.

  14. Jim Doherty Says:

    Cornflour. That wont work to well. Cause Trump is the kind of guy to make an example of one of them. You are running a company, and you are gonna threaten to move jobs? Who is gonna help defend you when the Pres comes for your ass? Your board of directors gonna stand in front of you?

    Now the small guys who have no choice but to move or die, those are the ones you must help.

    The others are just maximizing profits. Nothing wrong with that so long as the powers that be are ok with it and do not punish you. What happens when the guy on top does not need your campaign donation?

    What happens if the tax breaks given to corp’s in the US are scaled based upon the amount of products you produce in America vs elsewhere ?

    When you have a hard nosed person in the top job, some offers are really offers you cant refuse. ala the godfather.

    In the end, every corp in the world wants to sell their stuff in the US. No access to the US market is bad, real bad. Now put the godfather in charge of the gate to entry into that market……

    If Trump gets gdp growth to 4% for 4 years, he gets reelected.

  15. Frog Says:

    Waitaminnit. This is not a news story. It is from an editorial. Mercury News is on the Left Coast. We all should know how truthful the Left is now, after all these years.

  16. Artfldgr Says:

    populist is a communist marxist term
    left and right are communist marxist terms
    racism is a soviet term (coined by trotsky in 1937)
    and TONS other…

    Ever think how its hard to be anything but a communist if you think in communist terms?

    wake up…
    Your now thiking like the soviets we used to make fun of for thinking that way, and talking using those made up / meaningless terms of political games

    populism is the communist term that makes patriotism negative
    why is patriotism negative?
    you cant have international communism and one world government by communists IF you dont make patriotism and love of the home (which is what trotsky said made you racist) a good thing.

    so neo.. why do you call patriotism populism

    you like putting a capitalist on the same footing as the socilist nazi furer?

    not only have they changed the way you think by changing the definitions of words and using words that dont apply, but you guys blithly go on using them not realizing that the change to the language prevents you from thinking in ways that they dont influence by using the change.

    control the language you control thinking
    so why do you guys let them control your thinking?
    and dont say they dont, as the best control is the one in which that being controlled doesnt realize it.. (right aldous huxley?)

  17. Artfldgr Says:

    After leading the world for decades in 25-34 year olds with university degrees, the U.S. is now in 12th place. The World Economic Forum ranked the U.S. at 52nd among 139 nations in the quality of its university math and science instruction in 2010. Nearly 50% of all graduate students in the sciences in the U.S. are foreigners, most of whom are returning to their home countries;

    The Oklahoma Council of Public Affairs commissioned a civic education poll among public school students. A surprising 77% didn’t know that George Washington was the first President; couldn’t name Thomas Jefferson as the author of the Declaration of Independence; and only 2.8% of the students actually passed the citizenship test. Along similar lines, the Goldwater Institute of Phoenix did the same survey and only 3.5% of students passed the civics test;

    18% of Americans still believe that the sun revolves around the earth, according to a Gallup poll;

    [actually they revolve around each other… and either way is correct… as without a third reference, you cant tell who is moving… and the only major difference between the two is the complexity of the math that delineates orbits… with the sun center, the orbits are ovals and circles, with it the other way, the orbits look like spirograph images.. both are correct and depend on which perspective you pick]

    the U.S. ranks second among all nations in the proportion of the population aged 35-64 with a college degree, but 19th in the percentage of those aged 25-34 with an associate or high school diploma, which means that for the first time, the educational attainment of young people will be lower than their parents

    so maybe the workers in the US have been dumbed down enough that carrier can use them and pay less…

    According to the 2009 National Assessment of Educational Progress, 68% of public school children in the U.S. do not read proficiently by the time they finish third grade. And the U.S. News & World reported that barely 50% of students are ready for college level reading when they graduate;

    nearly half of Americans between ages 18 and 24 do not think it necessary to know the location of other countries in which important news is being made. More than a third consider it “not at all important” to know a foreign language, and only 14 percent consider it “very important;”

    According to the National Endowment for the Arts report in 1982, 82% of college graduates read novels or poems for pleasure; two decades later only 67% did. And more than 40% of Americans under 44 did not read a single book–fiction or nonfiction–over the course of a year. The proportion of 17 year olds who read nothing (unless required by school ) has doubled between 1984-2004;

    this one is a hoot:
    A 2008 University of Texas study found that 25 percent of public school biology teachers believe that humans and dinosaurs inhabited the earth simultaneously.

    when us oldsters die out as the boomers go… what remains is dumber than a rick shaw driver in sri lanka

    oh well
    im dying soon, so i dont give a sh*t..

  18. neo-neocon Says:

    Artfldgr:

    Maybe someday you will stop commenting by berating people. But the more you keep berating people and insulting them, the less people will listen to you or care what you say.

    Terms originate in certain ways, and yes—the Populist Party in this country (late 19th Century) was a leftist group. So what? Populism has a meaning, it’s a useful term, people in general know what it means, and there is populism on both left and right. It can be discussed without anyone being brainwashed, and without any particular inherent judgment on whether populism is good or bad or neutral.

    If you think my use of the word “populist” in this post has anything to do with patriotism, or is pejorative, then you didn’t understand the post.

    I wrote about patriotism here.

  19. Big Maq Says:

    @Neo – didn’t you know that democracy, republicanism, and the bill of rights are all communist marxist concepts used in their propaganda?

    The world is so full of communists ’round every corner, we have to be so very careful that they aren’t dodging around us with some artful confusion.

    /s

About Me

Previously a lifelong Democrat, born in New York and living in New England, surrounded by liberals on all sides, I've found myself slowly but surely leaving the fold and becoming that dread thing: a neocon.
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