“Ret­ri­bu­tion” threat for o≠shoring jobs Pres­i­dent-elect isn’t back­ing off on one of his key cam­paign prom­ises

The Denver Post - - NEWS - By Ylan Q. Mui

Pres­i­dent-elect Don­ald Trump fired an­other warn­ing shot Sun­day at U.S. com­pa­nies con­sid­er­ing mov­ing their op­er­a­tions out of the coun­try, threat­en­ing “re­tri­bu­tions or con­se­quences” such as a hefty bor­der tax if they do.

The pro­nounce­ments came in a string of early morn­ing tweets. Trump de­clared that he in­tends to in­cen­tivize busi­nesses to stay in Amer­ica by low­er­ing cor­po­rate taxes and slash­ing reg­u­la­tions, two key com­po­nents of his eco­nomic agenda. But he also warned that com­pa­nies with off­shore fac­to­ries would face a 35 per­cent tar­iff on goods sold back to the United States:

“The U.S. is go­ing to sub­stan­tialy re­duce taxes and reg­u­la­tions on busi­nesses, but any busi­ness that leaves our coun­try for an­other coun­try,”

“fires its em­ploy­ees, builds a new fac­tory or plant in the other coun­try, and then thinks it will sell its prod­uct back into the U.S . ...... ”

“with­out ret­ri­bu­tion or con­se­quence, is WRONG! There will be a tax on our soon to be strong bor­der of 35% for these com­pa­nies ...... ”

Trump’s com­ments fol­low his di­rect in­ter­ven­tion in an In­di­ana fac­tory owned by Car­rier, which makes heat­ing and air con­di­tion­ing units, where pro­duc­tion was sched­uled to shift to Mex­ico.

Trump an­nounced last week that he had ne­go­ti­ated a deal to keep the plant in the state. In­di­ana promised to pro­vide Car­rier about $7 mil­lion in in­cen­tives, while the com­pany would in­vest $16 mil­lion in the fac­tory over the next two years.

“Please be fore­warned be­fore mak­ing a very ex­pen­sive mis­take,” Trump said on Twit­ter. “THE UNITED STATES IS OPEN FOR BUSI­NESS.”

About 800 jobs that had been slated to move to Mex­ico will re­main at the plant, ac­cord­ing to a per­son fa­mil­iar with the ne­go­ti­a­tions. About 300 to 600 Car­rier po­si­tions — in ad­di­tion to 700 at one of the com­pany’s other fac­to­ries in the state — will be cut.

On the stump, Trump es­poused an ag­gres­sively pro­tec­tion­ist stance to­ward in­ter­na­tional trade, and his skep­ti­cism of the ben­e­fits of glob­al­iza­tion res­onated with many mid­dle-class vot­ers that bore the brunt of its down­side.

But since his elec­tion, his ad­vis­ers have soft­ened some of his most heated rhetoric. Trump’s pick for trea­sury sec­re­tary, Steven Mnuchin, and com­merce sec­re­tary nom­i­nee Wil­bur Ross said they would pur­sue bi­lat­eral trade agree­ments with other coun­tries but re­mained wary of sweep­ing re­gional deals.

Ross also said that blan­ket dou­ble-dig­its tar­iffs on goods from Mex­ico and China — which many econ­o­mists warned could spark a dam­ag­ing trade war — would be used only as a last re­sort.

But Trump’s com­ments Sun­day indi­cate that he is not back­ing away from one key pledge: to pun­ish com­pa­nies that off­shore jobs.

“We’re liv­ing through the great­est jobs theft in the his­tory of the world,” Trump said last week.

Trump cel­e­brated the deal with a tour of the fac­tory last week, fol­lowed by a rally in Cincin­nati to kick off his “Thank You tour.” On Capi­tol Hill, some con­ser­va­tives crit­i­cized the deal as a gov­ern­ment dis­tor­tion of the free mar­ket, while lib­eral law­mak­ers called the tax breaks a cor­po­rate sub­sidy. But busi­ness groups gen­er­ally wel­comed the move.

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