Columns

Sanders: Carrier Tax-Breaks Deal Should 'Send a Shock Wave of Fear' Through U.S. Workers

Employees walk in the Carrier Corp. plant parking lot on Nov. 30, 2016, in Indianapolis. (AP Photo/Darron Cummings)

WASHINGTON — Sen. Bernie Sanders (I-Vt.) wrote in the Washington Post today that workers aside from the 1,000 Carrier employees whose jobs were saved due to a deal cut by President-elect Donald Trump “should be very nervous.”

The air conditioning and heating company announced in February that it would move over a three-year period more than 2,000 jobs from an Indiana plant and distribution facility to Monterrey, Mexico, as a cost-cutting measure.

Carrier said in a statement Wednesday that the company “negotiated an agreement with the incoming administration that we believe benefits our workers, the state of Indiana and our company.”

The company said it “will continue to manufacture gas furnaces in Indianapolis, in addition to retaining engineering and headquarters staff,” stressing “the incentives offered by the state were an important consideration.” The Wall Street Journal reported that Carrier will reap $7 million in tax breaks over 10 years in the deal.

Trump and Gov. Mike Pence were headed to the Carrier plant today to celebrate the agreement.

“This is about the president-elect and vice president-elect making good on their promise to go to bat for American workers, which they’re doing so even before they’re actually sworn in and become the president and vice president,” spokesman Jason Miller told reporters on a conference call today. “That’s really what this deal is about.”

In his op-ed, Sanders argued that “instead of a damn tax” — words Trump used on the campaign trail to describe how he wanted to punish Carrier — “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 United States and move abroad? In essence, United Technologies took Trump hostage and won. And that should send a shock wave of fear through all workers across the country,” Sanders wrote.

“Trump has endangered the jobs of workers who were previously safe in the United States. Why? Because he has signaled 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 this morning. And who would pay for the high cost for tax cuts that go to the richest businessmen in America? The working class of America.”

Mark Perry, a scholar at the American Enterprise Institute, slammed the deal as “crony capitalism, legal plunder, and dishing out generous corporate welfare payments using taxpayer money.”

House Speaker Paul Ryan (R-Wis.) said today, though, that he’s “pretty happy that we’re keeping jobs in America — aren’t you?”

“Pence is still the sitting governor of Indiana. And I have no doubt that he probably had a hand in helping this. And this is what governors do,” Ryan told reporters at a press conference on the Hill. “I talk with Scott Walker about this stuff all the time in Wisconsin, where governors get involved in helping make sure that their companies stay in their states, or they attract companies to their states. That’s something that’s pretty common for state-level of government to do. And I don’t know the details of this, but I think it’s pretty darn good that people are keeping their jobs in Indiana instead of going to Mexico.”

Ryan added that “the tax code with respect to incentives in businesses, this is what tax reform is all about.”

“I don’t know that the contours of what Carrier’s experiencing, but we tax our businesses at much, much higher tax rates than our foreign competitors tax theirs,” he said. “Our corporate rate is 35 percent. The average in the industrialized world is 24 percent.”