Though it earned him scorn from most liberals and some conservatives, President-elect Donald Trump made good on one of his most unlikely campaign promises last week when he made a deal to keep nearly 1,000 Carrier Air Conditioning jobs in the U.S. But even supporters who praised the deal acknowledged that Trump couldn’t – and shouldn’t – go around giving tax breaks to every company that threatens to move manufacturing operations to Mexico.
In a series of tweets on Sunday, Trump indicated that the Carrier deal was not necessarily an example of how he would keep companies from moving jobs out of the country.
“The U.S. is going to substantially reduce taxes and regulations on businesses,” Trump wrote, “but any business that leaves our country for another country, fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. without retribution or consequence, is WRONG!”
Trump reiterated his plan to punish companies who send jobs to Mexico.
“There will be a tax on our soon to be strong border of 35% for these companies wanting to sell their product, cars, A.C. units etc., back across the border,” he wrote. “This tax will make leaving financially difficult, but these companies are able to move between all 50 states, with no tax or tariff being charged. Please be forewarned prior to making a very expensive mistake! THE UNITED STATES IS OPEN FOR BUSINESS.”
The Wall Street Journal editorial board, free market conservatives, and even Sarah Palin herself expressed sharp concerns over the Carrier deal, which used Indiana taxpayer dollars to get the company to stay put. Palin called it “crony capitalism” – strong words from someone who was one of Trump’s earliest and biggest supporters in the primaries.
But it’s obvious that the Carrier deal was meant to give Trump’s presidency a feel-good kickoff, take advantage of VP-elect Mike Pence, and make good to a specific promise made to the company’s workers. It doesn’t mean that this is the way Trump intends to save American jobs, and he clarified that with his Sunday tweets.
The free market – if it includes foreign labor willing to work for pennies on the dollars – is not going to keep the American economy afloat. There’s nothing wrong with expecting American companies to employ workers on American soil, and there’s nothing wrong with solidifying that expectation with monetary policy. If Trump can combine that with tax incentives that make the U.S. competitive again, no one should have any reason to complain.