On the surface, United Technologies' decision to keep 1,000 of its Carrier jobs in Indiana looks like a win-win for everybody, but not if the cost of doing business wipes out those workers in the long run, according to the The Wall Street Journal.
It certainly is a great political victory for President-elect Donald Trump, but United Technologies was planning a move to Mexico in the first place for a good reason — to remain competitive.
The Journal doesn't fault the United Technologies CEO for making the decision to stay; Trump massaged every pressure point on Carrier:
- Threat of a 35 percent tariff.
- Threat of losing 10 percent of its revenue from Pentagon sales.
- The PR hit of Trump from his bully pulpit.
Further, the $7 million from incentives is good and the company is banking on Trump's pledge to lower the corporate rate down to 20 percent.
But Trump has to win over companies with economic growth rather than 4 years of arm-twisting or else his "Carrier shakedown (as) a short-term political victory" will remain just that, the Journal notes.
"The larger point is that America won't become more prosperous by forcing companies to make noneconomic investments," according to the Journal.
"A nation gets rich when individuals and business are allowed to take risks as they see fit in a competitive economy. … Mr. Trump would help the economy, and his Presidency, far more if he focuses on getting the pro-growth parts of his agenda through Congress."
© 2024 Newsmax. All rights reserved.