Carrier just showed corporations how to beat Trump

On Thursday, about 1,000 Carrier workers and their families should be rejoicing. But the rest of our nation's workers should be very nervous.

President-elect Donald Trump will reportedly announce a deal with United Technologies, the corporation that owns Carrier, that keeps less than 1,000 of the 2,100 jobs in America that were previously scheduled to be transferred to Mexico.

Let's be clear: It is not good enough to save some of these jobs. Mr Trump made a promise that he would save all of these jobs, and we cannot rest until an ironclad contract is signed to ensure that all of these workers are able to continue working in Indiana without having their pay or benefits slashed.

In exchange for allowing United Technologies to continue to offshore more than 1,000 jobs, Mr Trump will reportedly give the company tax and regulatory favours that the corporation has sought.

Just a short few months ago, he was pledging to force United Technologies to "pay a damn tax". He was insisting on very steep tariffs for companies like Carrier that left the US and wanted to sell their foreign-made products back in the US.

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 US and move abroad?

Carrier workers during a visit by Mr Trump in Indianapolis on Thursday. Instead of hitting United Technologies - which owns Carrier - with a tax like he said he would do when campaigning, he is giving it a tax cut instead. PHOTO: NYTIMES

In essence, United Technologies took Mr Trump hostage and won. And that should send a shock wave of fear through all workers across the country.

Mr Trump has endangered the jobs of workers who were previously safe in the US.

Why? Because he has signalled 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 now. And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America.

Let's be clear. United Technologies is not going broke. Last year, it made a profit of US$7.6 billion (S$10.8 billion) and received more than US$6 billion in defence contracts.

It has also received more than US$50 million from the Export-Import Bank and very generous tax breaks. In 2014, United Technologies gave its former chief executive Louis Chenevert a golden parachute worth more than US$172 million. Last year, the company's five highest-paid executives made more than US$50 million. The firm also spent US$12 billion to inflate its stock price instead of using that money to invest in new plants and workers.

Does that sound like a company that deserves more corporate welfare from our government? Mr Trump's Band-Aid solution is only making the problem of wealth inequality in America even worse.

I said I would work with him if he was serious about the promises he made to members of the working class. But after running a campaign pledging to be tough on corporate America, Mr Trump has hypocritically decided to do the exact opposite. He wants to treat corporate irresponsibility with kid gloves. The problem with our rigged economy is not that our policies have been too tough on corporations; it's that we haven't been tough enough.

We need to re-instill an ethic of corporate patriotism. We need to send a very loud and clear message to corporate America: The era of outsourcing is over. Instead of offshoring jobs, the time has come for you to start bringing good-paying jobs back to America.

If United Technologies or any other company wants to keep outsourcing decent-paying American jobs, those companies must pay an outsourcing tax equal to the amount of money it expects to save by moving factories to Mexico or other low-wage countries. They should not receive federal contracts or other forms of corporate welfare. They must pay back all of the tax breaks and other corporate welfare they have received from the federal government. And they must not be allowed to reward their executives with stock options, bonuses or golden parachutes for outsourcing jobs to low-wage countries. I will soon be introducing the Outsourcing Prevention Act, which will address exactly that.

If Mr Trump won't stand up for America's working class, we must.


  • Bernie Sanders is a US senator from Vermont.
A version of this article appeared in the print edition of The Straits Times on December 03, 2016, with the headline 'Carrier just showed corporations how to beat Trump'. Print Edition | Subscribe