Trump to reveal deal to keep nearly 1,000 Carrier jobs in Indiana

[Fanatical Meat]

For all the tax break haters, I suppose what California has done to keep the movie industry is completely wrong too. They've given much larger that 700k.

http://news.usc.edu/105673/starstru...ars-on-hollywood-productions-usc-study-finds/

The five states with the greatest cumulative investment in the motion picture tax credits, according to the research:

• New York, $2.6 billion (enacted 2004)
• Louisiana, $1.5 billion (enacted 2002)
• Connecticut, $614 million (enacted 2006)
• California, $582 million (enacted 2009)
• Georgia, $529 million (enacted 2005)

Admittedly New York and Louisiana might have gone too far given the results they have recieved

As a non Trump voter I can say overall I approve a smallish tax breaks that I believe has some conditions attached to it plus the President to be being a bully works. I said about 6 years ago I want to see the resident acting more like a bully to companies that cut workers and cut workers pay.
During the Golden Years (50-70's) Presidents would call CEO's and either make thinly vailed threats about Government contract or potential compliance issues to pressure companies to do the right thing for workers. I believe there is a call from President Ford to one of the auto manufacturers essentially saying "Hire more People or you Army order for Trucks will go to this other guy who I'm sure will hire more people if I ask him to.".
Congratulations to Trump

*Also lets not forget what Obama's press secretary said, Trump will need to do this 852(?) more times to equal what Obama has done for Manufacturing. Tax cuts and threats isn't a silver bullet but when used appropriately it can work.

 

[ch33zw1z]

Still have 1300 jobs leaving.

Not terrible though. I mean, Mexico's gonna need it to pay for that wall.

 

[fskimospy]

This is more Pence than Trump. It's his state and has been his MO and the previous governors for years. Not knocking the results more the disingenuous credit for it.

I'll knock the results! Tax credits for businesses that threaten to move jobs overseas are a really stupid way to manage a state and preserve jobs. They undercut tax revenue, distort the business climate in favor of large businesses (small businesses can't relocate), and they usually don't even achieve the meager results they claim. They're a huge waste of time and money for a giveaway to rich people.

On top of that, the president elect personally intervening in a negotiation to grant a business special tax breaks sets a horrible precedent and encourages more companies to make the same threat, all for a piddling result of saving two tenths of one percent of jobs in one sector in a mid-sized state. While the people it directly affects should be very happy, the rest of us shouldn't be.

 

[Fanatical Meat]

I'll knock the results! Tax credits for businesses that threaten to move jobs overseas are a really stupid way to manage a state and preserve jobs. They undercut tax revenue, distort the business climate in favor of large businesses (small businesses can't relocate), and they usually don't even achieve the meager results they claim. They're a huge waste of time and money for a giveaway to rich people.

On top of that, the president elect personally intervening in a negotiation to grant a business special tax breaks sets a horrible precedent and encourages more companies to make the same threat, all for a piddling result of saving two tenths of one percent of jobs in one sector in a mid-sized state. While the people it directly affects should be very happy, the rest of us shouldn't be.

Just for clarity is CA wrong for tax cuts to Hollywood?

http://news.usc.edu/105673/starstru...ars-on-hollywood-productions-usc-study-finds/

 

[buckshot24]

You didn't answer what happened to the 35% tariff?

How do you know it has gone away? Trump hasn't even been sworn in yet. Now, will the state lose more than $700 per employee if those jobs left the state? I'd say yes and the tax payers would get "raped" even worse if they left.

 

[fskimospy]

Just for clarity is CA wrong for tax cuts to Hollywood?

http://news.usc.edu/105673/starstru...ars-on-hollywood-productions-usc-study-finds/

Yes, special tax incentives for selected businesses are almost always stupid.

EDIT: Absent some larger purpose. Like if the government wants to subsidize research or whatever then giving tax breaks to people who perform that research for you can be a way to accomplish it. But just tax breaks for doing the same business they would be doing otherwise in a specific area? Dumb, dumb, dumb.

 

[buckshot24]

Yes, special tax incentives for selected businesses are almost always stupid.

EDIT: Absent some larger purpose. Like if the government wants to subsidize research or whatever then giving tax breaks to people who perform that research for you can be a way to accomplish it. But just tax breaks for doing the same business they would be doing otherwise in a specific area? Dumb, dumb, dumb.

Yeah if they get the tax breaks and it doesn't change their behavior at all it would be dumb. If they leave the state otherwise how dumb is it to just let them leave? How much would it cost Indiana to have 1000 people lose their jobs?

 

[senseamp]

Is Indiana ready to pay all of its businesses to not outsource? Why wouldn't the others, like say Subaru, demand the same deal? Pay up, or we are off to Mexico.

 

[FrankRamiro]

Don't agree with this tax brakes for Corp. not to outsource jobs,because in the end when tax brakes terminates they will leave anyway,
a more effective way is to Tax big time these products when they enter the Country.

 

[imported_tajmahal]

Don't agree with this tax breaks for Corp. not to outsource jobs,because in the end when tax breaks terminate they will leave anyway,
a more effective way is to Tax big time these products when they enter the Country.

Agreed, i've always been a firm supporter of Fair Trade, not Free Trade. It's finally good to get a President that puts the American worker as his first priority.

 

[vi edit]

Here's more info and an outtake from Sanders on it:
https://www.washingtonpost.com/post...onald-trump/?tid=sm_tw&utm_term=.7902ed5ffb11

These are incredibly difficult topics because both sides of the argument have valid reasons to be for and against them. You can't look at them in purely partisan views.

You have state and federal income at play from corporate taxes. You have the whole economic engine at play with not just the 1000 jobs restored there...but all of the ancillary boosts from those jobs. There's a number of local businesses that benefit from that factory being there. Suppliers, shippers, ect. Day cares, schools, small businesses, ect that all are affected by having those positions there. All of that feeds back into the state and federal economy in some way as well.

So you can't view it in a vacuum. I understand the concern for the "race to the bottom" via tax incentives and the burden it places on state budgets. I also understand the precedence it sets for other businesses to be able to corporate bully their way into threatening to leave for the next cheapest state or country if they don't get their way. I totally understand that. I lived in Peoria IL for almost 20 years with Catepillar being infamous for holding the area hostage with constant threats to leave. It is the top employer in the region by almost 4x as many than the next largest. It was over 16,000 jobs plus thousands of more ancillary that supported it in some shape or fashion.

The sad reality is that in some situations the states do not have a ton of leverage to push back. Particularly in a case like Cat. They know that if the company calls their bluff and does actually move out entire regions can get decimated. That was another one of the reasons I moved away from Peoria. It was almost entirely propped up and supported by Cat. If Cat closed up and moved elsewhere then Central IL would be the next addition to the rust belt region.

States have to walk a delicate line and it's not a job I would envy in the least. Whatever decision you make is bound to make someone pissed off. At least in the case of Carrier, I as a normal purchasing consumer have some ability to fight back. If I am truly upset with them moving jobs to Mexico, I can at least shop for my next HVAC with a brand that has domestic manufacturing. It's the same thing as with cars or tools or any other product I can support domestic production of. But with something like Cat, I'm not really shopping for a multi million dollar construction equipment on my own and not in any position to really enforce any sort of boycott on their products (or at least easily).

And that's where things really get messy for governments. They've already dipped their toe in the wheel and deal pool of corporate tax rates to pander to businesses. They are the ones that will take the publish backlash if they come out and stop renewing tax deals and take a hardline on setting standard and non-negotiable rates for business. They will have to prepare voters for the fallout because it won't be pretty. There's going to be collateral damage. It's just a question of how much, and for how long will people be able to handle it before they can normalize.

 

[HomerJS]

Tax incentives for businesses are not unusual and have been commonly used by States for decades and decades. Hack, please tell us where has your outrage has been hiding all this time.

Same question....what happened to Trump's boasting promise of enacting a 35% tariff?

 

[Doc Savage Fan]

Same question....what happened to Trump's boasting promise of enacting a 35% tariff?

How about you answering my question first please.

 

[HomerJS]

How about you answering my question first please.

Since I posted the first question you should have provided the first answer but I'll bite...

I don't have an issue with tax incentives in theory but just imagine if Trump while running had been honest we are going to charge the people of Indiana to get Carrier to stay.

Now what about Trump's tariff promise? Or was that just more of his horseshit he told to get red staters to vote for him?

 

[feralkid]

Tell the people who work in that community that their jobs are meaningless. They'd gladly call you an asshole and tell you to F-off! I hope Trump does much more of this kind of stuff. The country needs it.

We need more of the government making taxpayers subsidize corporations?

Really?

 

[fskimospy]

Here's more info and an outtake from Sanders on it:
https://www.washingtonpost.com/post...onald-trump/?tid=sm_tw&utm_term=.7902ed5ffb11

These are incredibly difficult topics because both sides of the argument have valid reasons to be for and against them. You can't look at them in purely partisan views.

You have state and federal income at play from corporate taxes. You have the whole economic engine at play with not just the 1000 jobs restored there...but all of the ancillary boosts from those jobs. There's a number of local businesses that benefit from that factory being there. Suppliers, shippers, ect. Day cares, schools, small businesses, ect that all are affected by having those positions there. All of that feeds back into the state and federal economy in some way as well.

So you can't view it in a vacuum. I understand the concern for the "race to the bottom" via tax incentives and the burden it places on state budgets. I also understand the precedence it sets for other businesses to be able to corporate bully their way into threatening to leave for the next cheapest state or country if they don't get their way. I totally understand that. I lived in Peoria IL for almost 20 years with Catepillar being infamous for holding the area hostage with constant threats to leave. It is the top employer in the region by almost 4x as many than the next largest. It was over 16,000 jobs plus thousands of more ancillary that supported it in some shape or fashion.

The sad reality is that in some situations the states do not have a ton of leverage to push back. Particularly in a case like Cat. They know that if the company calls their bluff and does actually move out entire regions can get decimated. That was another one of the reasons I moved away from Peoria. It was almost entirely propped up and supported by Cat. If Cat closed up and moved elsewhere then Central IL would be the next addition to the rust belt region.

States have to walk a delicate line and it's not a job I would envy in the least. Whatever decision you make is bound to make someone pissed off. At least in the case of Carrier, I as a normal purchasing consumer have some ability to fight back. If I am truly upset with them moving jobs to Mexico, I can at least shop for my next HVAC with a brand that has domestic manufacturing. It's the same thing as with cars or tools or any other product I can support domestic production of. But with something like Cat, I'm not really shopping for a multi million dollar construction equipment on my own and not in any position to really enforce any sort of boycott on their products (or at least easily).

And that's where things really get messy for governments. They've already dipped their toe in the wheel and deal pool of corporate tax rates to pander to businesses. They are the ones that will take the publish backlash if they come out and stop renewing tax deals and take a hardline on setting standard and non-negotiable rates for business. They will have to prepare voters for the fallout because it won't be pretty. There's going to be collateral damage. It's just a question of how much, and for how long will people be able to handle it before they can normalize.

It's the same problem with the stadium financing scam, businesses with mobility fleece state and local governments so that the public subsidizes their business. It has to stop.

I think the first step would be for the federal government to phase out tax preference for any bonds from a state that engages in this sort of stupidity. That should put a big dent in it right away.

 

[Fanatical Meat]

Since I posted the first question you should have provided the first answer but I'll bite...

I don't have an issue with tax incentives in theory but just imagine if Trump while running had been honest we are going to charge the people of Indiana to get Carrier to stay.

Now what about Trump's tariff promise? Or was that just more of his horseshit he told to get red staters to vote for him?

Homer at the risk of sounding like Trump, this is a good deal. He didn't have to enact a tariff, he threatened it and it appears he also threatened Carrier with losing some Military contracts which represents 10% of their overall business. 700k to keep 1000 jobs plus whatever else these 1000 jobs require is pretty small money.
Liberals like you and I have to give credit when its due and adopt ideas that work. This could change if every employer starts looking for more and more tax breaks but we're not their and it may not even happen.

 

[Mai72]

35% Tarrif?

If anyone thinks this is a great idea, they should read the Smoot-Hawley 1930 Tarrif Act.

 

[vi edit]

It's the same problem with the stadium financing scam, businesses with mobility fleece state and local governments so that the public subsidizes their business. It has to stop.

I think the first step would be for the federal government to phase out tax preference for any bonds from a state that engages in this sort of stupidity. That should put a big dent in it right away.

I don't see it as the same problem, particularly in the example of public funded stadiums. I absolutely loathe that. If a billionaire wants to come in and build a stadium under his own dime. Fine. Build away. But don't ask the public to pay for that through bonds/referendums which is direct capital into the building of a tangible product.

With tax incentives you aren't fleecing more money out of tax payers in the same way. They aren't on the hook for a half a billion dollar building like they are for a stadium. To me it's a lot like the "digital theft" argument of "you wouldn't steal a car would you?". One is a tangible, err...concrete cost. The other is much more abstract and difficult to pin a real tax cost on.

 

[fskimospy]

I don't see it as the same problem, particularly in the example of public funded stadiums. I absolutely loathe that. If a billionaire wants to come in and build a stadium under his own dime. Fine. Build away. But don't ask the public to pay for that through bonds/referendums which is direct capital into the building of a tangible product.

With tax incentives you aren't fleecing more money out of tax payers in the same way. They aren't on the hook for a half a billion dollar building like they are for a stadium. To me it's a lot like the "digital theft" argument of "you wouldn't steal a car would you?". One is a tangible, err...concrete cost. The other is much more abstract and difficult to pin a real tax cost on.

You're right that they aren't fleecing taxpayers in the same way, but in both cases taxpayers are being fleeced as it's still money out of the public treasury in the end. Either way you're using public funds or special tax giveaways to large businesses that aren't available to smaller ones and that means taxpayers are subsidizing a certain business's business model because they used their mobility to shake down a local government that's not strong enough to resist them.

I still think the answer is that any bond issued by a government that participates in these schemes should lose its federal tax deduction. Want to give your citizens' money away to giant corporations? That's your business. Oh, it turns out you have to borrow money either to finance this scam or because you've depleted your treasury with tax breaks? Don't expect the rest of the country to subsidize your dumb move.

 

[Doc Savage Fan]

Since I posted the first question you should have provided the first answer but I'll bite...

I don't have an issue with tax incentives in theory but just imagine if Trump while running had been honest we are going to charge the people of Indiana to get Carrier to stay.

Now what about Trump's tariff promise? Or was that just more of his horseshit he told to get red staters to vote for him?

Your first question wasn't addressed to me. But thanks for answering my direct question to you.

You say above that you "don't have an issue with tax incentives in theory" yet you previously couched this particular case as "stuck the bill Carrier was going to pay on the citizens of Indiana" and "double penetration ass raping of the people of Indiana by Donald and Mike". Perhaps you can explain to me this apparent cognitive dissonance. I'm all ears.

Anyway, taking the human side of the equation aside, this is a net gain for Indiana tax payers as well...they subsidized Carrier $700,000 per year for 10 years and will realize nearly double that in tax revenue per year from the 1000 jobs kept (using $40k average salary times 3.3% State income tax). This was a good deal for everybody...especially when considering the alternative.

As far as your 35% tariff question goes, Trump isn't even President yet and even if he was, he'd be incapable of unilaterally enacting a tariff which requires Congressional approval. I imagine that he'll make every effort to level the playing field and I personally believe we'll see progress in this area during his administration. There are a lot of ways to skin a cat, but a 35% tariff will never fly imo.

 

[Blackjack200]

LMAO, Trump is going to Indiana for a victory lap over 1,000 jobs? Obama creates a quarter million a month.

 

[Doc Savage Fan]

LMAO, Trump is going to Indiana for a victory lap over 1,000 jobs? Obama creates a quarter million a month.

Specifically, what has Obama done to "create" these jobs?

 

[Blackjack200]

I'd be happy to answer that question if someone I had any respect for asked it.

 

[jackstar7]

Specifically, what has Obama done to "create" these jobs?

I'd like to know specifics on what he's done to kill jobs, since that is thrown around just as often.