Bernie Sanders Calls out Trump's Deal With Carrier

December 1st 2016

Mike Rothschild

The aftermath of President-elect Donald Trump and Vice President-elect Mike Pence's announcement that they'd made a deal with home heating giant Carrier to keep 1,000 jobs in Indiana rather than move to Mexico was decidedly mixed. Conservatives cheered it as an example of Trump following through on his promise to keep jobs in America.

However, Vermont Senator Bernie Sanders noted in an op-ed for The Washington Post Thursday that the deal might actually lead to more jobs lost to offshoring, and he echoed economic scholar Justin Wolfers' concern of an unintended consequence of Trump's promise.

Sanders was blunt in his negative assessment of the deal, saying that those whose jobs were kept should rejoice, but the rest of us should be "very nervous." Rather than demand that companies like Carrier pay hefty taxes as punishment for outsourcing, Trump and Pence gave Carrier a tax cut to save some jobs - while others were still eliminated, he added:

Just a short few months ago, Trump was pledging to force [Carrier parent company] United Technologies to “pay a damn tax.” [...] 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?

The company took Trump hostage and the president-elect paid the ransom, Sanders explained in his op-ed.

He went on to note that company executives will now have nothing to lose by planning to outsource - either it will leave and save money, or stay and make money:

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 this morning.

Sanders also noted a point that has mostly been unmentioned in the aftermath of the deal - tax cuts have consequences. It will reduce the ability of both state and local governments to provide essential services to those in need - working people like those at Carrier, struggling to stay ahead of a rapidly changing economy. Sanders himself sums it up with the following: "And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America."

Economists, in particular, savaged the deal with conservative think tank, the American Enterprise Institute, calling it "inconsequential," "terrible for a nation’s economic vitality" and an example of the "crony capitalism" the Obama administration was attacked for by Republicans. It's clear that while saving 1,000 jobs is a good thing to those workers and their families, the situation is much more complex than having a president simply give every CEO whatever they want, while the rest of us pay for it.

Read Sanders' full op-ed for The Washington Post here.