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Donald Trump pulled off a masterful deal that saved more than half of the jobs at the Carrier plant that was supposed to be shipped out to Mexico. The deal involved a $7.0 million tax incentive from the state. I assume there was some verbal jabbing with respect to the almost $7.0 billion a year the company’s aerospace and aircraft engines divisions does with the federal government.
Now, there is the anticipation of more announcements as the list of companies moving to Mexico and other countries is relatively long.
Some conservative economic purists on the right like Jonah Goldberg and even Sarah Palin (see box) don’t like the idea of a President or President –elect cutting deals with companies; using taxpayer funds, suggesting its simply crony capitalism.
On the left, Bernie Sanders and Paul Krugman claim that the president bowed to extortion.
The fact of the matter is that companies aren’t inherently anti- American but their bottom line comes from patriotism. On that score, these companies would love lower taxes, fewer regulations, and the ability to save money (being closer to the buyer of their products). America also has an abundance of energy, including cheap natural gas and even cheaper coal.
Still, as recently as Friday, Ford reiterated its intentions of moving small car productions to Mexico. The CEO of the company, Mark Fields, said he was willing to work with the new administration if some things could be done on the Corporate Average Fuel Economy (CAFE) standards and other incentives.
Wink: Tax breaks?
It’s not scheduled to happen for a couple of years, so there’s time for the Trump administration to make America more attractive to manufacturers. However, there are some companies where employees need Trump to work his magic immediately.
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