Donald Trump threatens U.S. companies that would send jobs overseas
President-elect Donald Trump chose to give his first major public address since winning the presidency at a Carrier manufacturing plant in Indianapolis Thursday, and it was classic Trumpian stream of consciousness. He briefly touched on border security, corporate taxes, regulation, and trade policy. He also repeatedly referred to the air conditioners made at the plant — except they aren’t. Carrier is known for its air conditioners, but the plant Trump was standing in makes furnaces.
Trump and his vice president-elect, Indiana Gov. Mike Pence, cut a deal with Carrier’s parent company, the major manufacturing firm United Technologies, to keep about 1,000 jobs at the Indiana plant that had been scheduled to be outsourced. In return, the company will receive $7 million in tax incentives.
Trump said his administration is going to lean hard on companies that consider outsourcing, and that ones moving jobs overseas will face “consequences,” hinting at huge tariffs on imported goods.
“We’re gonna have a lot of phone calls when companies say they’re leaving the country, because they are not leaving,” Trump said.
One such company is Rexnord, which makes mechanical components and water supply systems. The Milwaukee-based firm has a ball-bearing factory about one mile away from the Indianapolis Carrier plant. The 300 or so workers there were told in October that they would be laid off and their jobs moved to Mexico.
Workers at Rexnord are still waiting for Trump to call their bosses. Don Zeiring, the 62-year-old head of the plant’s United Steelworkers Union membership, said the change of heart at the nearby Carrier plant has some of his members wondering if Trump can save their jobs, too.
“They say ‘maybe,’” Zeiring said while on break from his job on the plant floor, where he has worked for decades. “That word is still there, ‘Maybe Trump can help us.’”
Details of the negotiations between United Technologies and Trump’s team have been scarce, but some reporting suggests the company worried that its massive government contracts could come under fire if the company didn’t do as Trump asked. It’s difficult to make drastic and sudden changes to government contracts negotiated years in advance, but with billions of dollars worth of contracts at stake, the company no doubt wanted to avoid landing on the administration’s enemy list.
The government doesn’t have the same kind of leverage over Rexnord; its 2016 government contract portfolio was only about $6 million last year.
Privately, union leaders worry that Trump’s deals could be a Pyrrhic victory for workers, who may be told that they have to take a steep pay cut in order to keep their jobs.
It’s not clear if organized labor will play a role in Trump’s efforts to save Midwest manufacturing jobs. Chuck Jones, the president of the United Steelworkers in Indiana — the union that represents workers at the Carrier and Rexnord plants — went to the Carrier event today to speak with Trump officials. Jones and the union were not briefed on the deal ahead of time.
Jones said he was checked by Secret Service and placed in a holding room to await Trump while the president-elect toured the plant. Jones said he was eventually told Trump’s schedule was too tight for a meeting; Trump left without speaking to him.
Jones’ take on the Carrier deal: United Technologies’ government contracts are “one hell of a bargaining chip.”
Zeiring is optimistic about Trump. He backed Bernie Sanders before voting for Hillary Clinton in November. But after the Carrier deal, he told VICE he wishes he could go back in time and vote for Trump.
Though he’s not sure if Trump’s pronouncements will help him keep his job, Zeiring said he estimates his chances of staying on are about 20 percent.
“I don’t want to get anybody’s hopes up,” he said. “I’m going to be doubtful until it happens, but I’m going to be expected to try to give it 100 percent until the day the door closes.”
Olivia Becker contributed additional reporting.