Trump and Carrier’s Publicity Stunt

author is compensated via Patreon; please consider becoming a monthly patron

The Trumpence deal “saved” 600 employees at $64k yearly is a $38.4 million expense. Why say $64k yearly? Here’s the previous deal offered:

The Indiana Economic Development Corp. said it has offered Carrier $5 million in conditional tax credits based on a plan to retain 1,069 jobs with an average wage of $30.91 per hour, spokeswoman Abby Gras said. [Reuters]

The US military accounts for roughly 10% of Carrier’s $56 billion in operating revenue — that’s $5.6b [WSJ].

Carrier’s total US workforce is about 50,000 people, which is $3.2b in expenses at $64k yearly. Which is fairly insignificant when your revenue is $56 billion.

For a $7 million tax break (over 10 years, so $700k yearly), Carrier will keep 600 jobs here and invest $16 million into their Indiana plants (in year one).

1,300 Carrier jobs (an expense of $83.2 million at $64k yearly) will be exported to Mexico, where the minimum wage just raised this year to $4.30 an hour with a 48-hour work week, coming to a total of $10,732.80 a year. Operating those 1,300 jobs in Mexico will cost $13.9 million, for a savings of $69.3 million yearly [Washington Post].

Take $38.4 million yearly out to keep 600 jobs in, then take out a one-time $16 million investment. Finally, add in $700k yearly in tax savings.

Carrier comes out $15.6 million ahead year one, and $31.6 million ahead for the following 9 years.

Essentially, Carrier:

  • Carved out about ⅔ of their workforce in these Indiana plants
  • Saved $331.6 million over the next 10 years
  • Used it as a misinformation tool to appear working-class-friendly in the news and give Trump his first post-election “win”

Also, Trump:

  • Did not broker this deal; Indiana Governor and Vice President-Elect Mike Pence did
  • Can not act as if he was tough on Carrier, whom he called out and promised to save the jobs of, via steep tax consequences specifically
  • Lied about the means they would use to retain Carrier’s jobs in the United States
  • Lied about the number of Carrier jobs the deal would retain in the United States

If you appreciated the perspective in this piece, don’t forget to click the heart.

Peter Coffin is a writer and performer. Aside from essays, he also creates web series. You can support all of his endeavors via Patreon.