President-Elect Donald Trump Takes on the Rust Belt - Pacific Standard

President-Elect Donald Trump Takes on the Rust Belt

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Saving 800 jobs in Indiana cost Trump another 1,300 and who knows what else.

By Jim Russell

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Donald Trump speaks at the Grand Park Events Center on July 12th, 2016 in Westfield, Indiana. (Photo: Aaron P. Bernstein/Getty Images)

Indiana would prove decisive. Now President-elect Donald Trump trounced Ted Cruz in the early May primary vote and all but sealed the deal for the GOP nomination. In April, Trump and Cruz sparred when Carrier, a manufacturing company, announced intentions to move jobs out of Indiana to a plant located in Mexico. Trump’s threats resonated better with the state’s voters:

“You’re going to bring it across the border, and we’re going to charge you a 35 percent tax …. Now within 24 hours they’re going to call back. ‘Mr. President, we’ve decided to stay. We’re coming back to Indianapolis.’”

Cheaper production in Mexico would cost dearly in any attempt to bring the goods to the American market. Trump talked tough and promised to bring blue-collar work back to the United States from abroad. What about stemming the outflow?

Even before Trump takes over the White House, we the people get an answer to that question. With help from Vice President-elect (and current Indiana governor) Mike Pence, Carrier is sort of staying. Eight hundred jobs will remain and 1,300 will still go. If I focus on the first part, Trump-Pence made America great again. If I focus on the second part, Trump makes the worst deals.

I was born and raised in the Rust Belt. I vividly remember when the federal government stepped in to save Lee Iacocca’s Chrysler. Ronald Reagan campaigned as a critic of the life ring. He would do steel no favors when Pittsburgh’s economy tanked in the early 1980s. But in 2002, President George W. Bush did step in with tariffs. With the country still grappling with the Great Recession, President Barack Obama did his part for the auto industry. Manufacturing has been a political football for decades.

Over those same decades, manufacturing employment has plummeted. Interventions large and small, at all levels of government, have failed to stem the macroeconomic tide. Bailouts help companies, not workers. Despite that shortcoming, politicians enjoy a windfall of positive optics when displaying concern about the little guy.

In April, Trump said he would do something about Carrier going to Mexico. After he won the general election, Trump did something about Carrier going to Mexico. It cost at least $7 million in subsidies from the State of Indiana. Par for the course as far as the Rust Belt is concerned.

What else was promised Carrier? We may never know. Bottom line, 1,300 American manufacturing jobs are disappearing and some operations are heading to Mexico. Does Carrier ship those items back to the U.S. without penalty? I would bank on it. Either way, the Rust Belt got screwed and Trump looks all the better for it.

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