RE: Carrier stays in US
December 2, 2016 at 12:03 pm
(This post was last modified: December 2, 2016 at 12:20 pm by Anomalocaris.)
You also need to consider this 7 million does not include the cost to the entire US economy because, essentially the same AC units, delivering the same benefit and utility to the end user, if made in the US, would now impoverishes the end users all over the US more.
Carrier's annual revenue does not appear easy to find because it is privately held. But typical appliance industry generates about $250,000 in annual revenue per employee. The Indiana plant therefore generates roughly $250,000,000 in annual revenue. Let's say for the sake of argument the entire sales from the plant is to American consumers. Let's say moving the plant to Mexico allows each AC unit be sold for 5% less. That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana. Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.
So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes. But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.
At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.
Carrier's annual revenue does not appear easy to find because it is privately held. But typical appliance industry generates about $250,000 in annual revenue per employee. The Indiana plant therefore generates roughly $250,000,000 in annual revenue. Let's say for the sake of argument the entire sales from the plant is to American consumers. Let's say moving the plant to Mexico allows each AC unit be sold for 5% less. That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana. Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.
So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes. But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.
At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.
